Appraisal Work for Estates – I can prepare appraisals for taxable and non-taxable estates. Here are some reasons your family may need an appraisal:
1.Educated decisions – Often I am hired to conduct a “walk through” to inspect the contents of the home and identify potentially valuable items for an estate. This education process allows the family to make decisions about what to keep, sell, or donate. Even if there are no valuable items, the walk through confirms what is actually there, and this is a relief to the family. I can provide suggestions for disposal of the items once the process is evaluated.
2. Discovery – There have been many cases over the last 20 years where the family thought there was nothing of value, and there were actually several significant items that could be sold or kept by family members. At one home, the Decedent stored her fine jewelry with her costume jewelry. When the jewelry was inspected with a jeweler’s loop, we identified over fifty pieces of fine jewelry, including gold, that was set aside and later appraised by a jewelry appraiser (GIA). The family was thrilled that they had not donated the jewelry before I arrived, as planned. Discovery happens all the time, and when there are no “surprises,” everyone can sleep at night knowing they did not give away or throw away something an heirloom or something valuable.
3. Wills & Trusts – Are you preparing your will and trust, and does it include an inventory of valuable and sentimental items? How will your beneficiaries know what your wishes are for distribution? Appraisers help you protect your collections and heirlooms by documenting and valuing these special items. Documentation is confidential and retained electronically for at least five years.We can prepare documentation with photographs for later use. Let us help you avoid disagreements during a sad time.
4.Tax returns – Estates must have a written inventory of household contents if the assets are over the limit set by IRS. Also, an estate tax return, Form 706, must be filed if the gross estate, plus any adjusted taxable gifts and specific gift tax exemption, is more than the filing requirement for the year of death.
5. Surviving Spouse / Probate – Appraisals are also prepared for Attorneys, Trustees, and Personal Representatives to establish a tax basis for the surviving spouse, A “Qualified Appraiser” is defined by IRS. I am a qualified, accredited appraiser (AM), verifiable through the website of the International Society of Appraisers (www.isa-appraisers.org). This means I have passed all required exams, follow uniform standards of professional appraisal practice rules (USPAP), and comply with continuing education and re-qualification requirements. On the website, an Appraiser who is formally educated will have the initials “ISA AM” or “ISA CAPP” following their name. Appraisers who have not complied are strictly members, and only have “ISA” following their name.
6. Equitable Distribution – Written appraisals also requested for the equitable distribution of property among beneficiaries/family members. This is extremely helpful for keeping distribution fair, and keeping the peace among family members!
7. Donations – Often the Owner or Beneficiaries of an estate will take the property that is sentimental to them, and donate the remaining contents. Contents having a total value of $5000 or more are appraised for submission with yearly income tax filings.
8. Estate Sales – Appraisals can help a Seller estimate the gross income on the sale of the estate contents. One way to sell an estate is through a liquidation sale. The goal of a liquidation sale is to earn similar values summarized on the appraisal while relieving Clients of the burden of selling and removing the personal property. I can refer you to a reputable, trustworthy liquidator, as I do not conduct these sales. Liquidators can also ship items home for you. Be prepared to pay a fee, usually a percentage of the earnings, for this service. When an estate is liquidated, the sale proceeds may be less than the appraised values.
The net income of a liquidation sale may be less than expected. Some reasons why include:
a. Owners have assigned a sentimental value to the item that has no bearing on the actual sales history of that item.
b. Owners have seen the item at an antique show at full retail; liquidation sales do not obtain retail prices, as a dealer or storefront could.
c. The Owner has compared the estate appraisal at fair market value to an insurance appraisal (RETAIL replacement appraisal) completed previously for homeowners insurance coverage. Insurance appraisals contain full retail prices. Fair market values and retail valuations are two entirely different values, researched from two entirely different sources.
d. Owners purchased the item (sometimes for the Decedent) and remember what they paid “X” a number of years ago, e.g., Swarovski collection at full price from a retail shop. Sometimes there is an incorrect assumption that an item will appreciate, or at least hold its value. This is often not the case, unfortunately.
e. The total value of contents IS affected by the “less desirable” items in the home that become a burden to an estate buyer. The buyer, when calculating an offer, has reduced the offer to the Seller by factoring in expenses, i.e., moving costs and disposing of the less desirable items that are not valuable or desirable in the marketplace. The value also decreases when a family removes some or all of the valuable items, affecting the desirability of the contents as a whole.
9. Part 2, Sell, Donate, or Liquidate – Once I help you identify valuable items and and your the family has decided what to keep and sell, a consultation will be needed to determine how to to proceed (sell, donate, or dispose). I can further assess your specific situation and determine the next steps.
Inspection Process – Appraisers prepare a supervised inventory on-site, room by room, recording and photographing every item in the home. Fixtures (e.g., chandeliers) and appliances (e.g., kitchen appliances) are excluded.
a. The degree of detail in the item description is determined by the type of item and value. Any one item valued over $100 must be listed individually per IRS instructions, otherwise, grouping of items is allowed. Grouping of like items, e.g., figurines, with individual prices, keeps the report to a manageable size. Examples of grouping include miscellaneous (bric-a-brac), kitchen items, closet and bathroom contents – generally, dollar items, and inexpensive decorative art.
b. In general, Appraisers charge an hourly rate, depending on the type and complexity of the task. Specialists in a particular field, e.g., rugs, Asian antiques, sports collectibles, jewelry, charge per hour. Clerical activities, e.g., typing, are billed at $25 per hour.
Please contact me by phone (561.350.3444) to discuss the scope of work, fees, and payment process.