Estate Appraisals

For estate tax filing and estate planning appraisals, the appraiser determines the fair market value of your personal property. The IRS provides the definition of fair market value, which, simply put, is the value of your items on the open market. They continue, “It is the price that would be agreed on between a willing buyer and a willing seller, with neither being required to act, and both having reasonable knowledge of the relevant facts.”

Most commonly, the fair market value is the secondary market value, or the auction market because it where personal property most often is resold. There are exceptions when an artist does not have an established secondary market; in this case, the appraiser would look to the retail market.

In 2024, an estate worth more that $13.61 million, or $27.22 million for a couple is subject to an estate tax. This type of appraisal report tends to be quite extensive, with a room-by-room inventory of items or groups of items with their secondary market values. For these reports, the IRS requires photographs, cataloging information, sales comparisons, and a narrative that explains the reasoning for the valuations. Typically, the executor of the estate is responsible for hiring a personal property appraiser.

An executor also hires an appraiser to determine the step up in the fair market value of the personal property within a taxable estate for a couple when just one of the spouses has passed away. This type of appraisal tends is less extensive than the one that the IRS requires when the surviving spouse passes away and an estate tax is due.

Collectors often hire an appraiser to write an estate planning appraisal report to plan for the distribution of their personal property to heirs or a charity, or the sale of their items. This type of report is designed for an individual or couple’s individual needs and is customizable.