Qualified Appraisal

Posted in Finance, Accounting and Economics Terms, Total Reads: 397
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Definition: Qualified Appraisal

Tax deductions for the charitable contributions must meet the federal standards. To claim a deduction for donating a conservation easement, a landowner must obtain a qualified appraisal.


A qualified appraisal means an appraisal document which:

• Relates to the appraisal which is not made earlier than 60 days before the date of the contribution of the appraised property

• Is made, signed as well as dated by the qualified appraiser &

• Does not involve an appraisal fee prohibited by Treasury Regulations


Any qualified appraisal should include following information:

• A little description of property with sufficient details for a person not so familiar with it to assure that the appraised property is the same which will be or was contributed

• Physical condition if it’s a tangible property

• The date of contribution to the donee

• The terms & conditions of the agreement entered into by or on behalf of both the parties involved which relate to the sale, use or any other disposition of property contributed


o Example: donation of a property for a particular use only & not for any other purposes

• The name, address & the identifying code of the qualified appraiser with his organization

• Qualifications of the qualified appraiser signing the appraisal which also include his experience, education, background as well as the membership in a professional appraisal associations if he has any

• A statement describing that the appraisal was prepared for the income tax purpose

• The date of appraisal

• Appraised fair market value of property on the date of contribution

• The method used for the evaluation of the fair market value of property involved

• A specific basis used in the valuation such as specific comparable sales transactions or statistical sampling techniques used

 

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