What qualifies an appraiser to value my personal property? A qualified personal property appraiser should have formal education in appraisal theory, principles, procedures, ethics, and law. They should be up-to-date on the latest appraisal standards. Continuing education and testing are the only ways to ensure this competence. Do all appraisers have similar qualifications? No. There are self-acclaimed personal property appraisers who have not completed any professional education. Obtaining a copy of an appraiser’s professional profile or resume can help evaluate the appraiser’s credentials. What does the appraisal function mean? There are different functions for personal property appraisals. The function of an appraisal identifies how an appraisal is to be used. It is the way you, the client, will use the report. You may want to obtain insurance coverage, determine a casualty loss deduction, determine loan collateral, determine proceeds from a liquidation, establish an amount for a non-cash charitable contribution, determine a fair asking or buying price, or determine federal or state estate tax liabilities. But did you know that the same item may have many different appraised values depending on how you intend to use the appraisal? For instance, a value for insurance may be very different than a value for estate tax, consumer resale, or charitable contribution. What Do the Different Values Mean? The function or what you are going to do with the information dictates the value being sought. For instance, the values may be different if you want to insure an item or if you want to sell that item in a short period of time. After the function has been decided, your appraiser will provide the values. For instance, insurance appraisals are written to provide replacement cost should a disaster occur and estate settlement appraisals are written to provide fair market value to satisfy the courts and IRS. Qualified, educated appraisers understand the many different types of values, assigned uses, and market levels. A trained appraiser can work with you to choose the proper type of value so that you can use the appraisal correctly and effectively. How do you handle items that may be outside your specialty area? No personal property appraiser should claim expertise in everything. The International Society of Appraisers (ISA) recognizes over 200 areas of specialty knowledge. A good appraiser knows their limits and is expected to consult with other experts when necessary. What is your fee and on what basis do you charge? Do not hire a personal property appraiser who charges a percentage of the appraised value or charges a “contingency” fee. These practices are clearly conflicts of interest and may result in biased values. The IRS will not accept an appraisal done with such fee arrangements. Hourly fees are acceptable. What will the appraisal report be like? If you contract for a formal appraisal, you will receive two copies of a written appraisal report that includes the following: – A statement of the purpose and intended use of the appraisal. – A detailed description of the subject property including the age, history, construction, materials, dimensions, and condition. – An explanation of the methodology employed by the appraiser. – A list of comparable objects used in the appraisal. – A statement, signed by the appraiser, that he has no current or future interest in the appraised object and that the appraisal report conforms to the standards and procedures of the Uniform Standards of Professional Appraisal Practice (USPAP). – A clearly defined appraised value. – The effective date of the appraisal. – The appraiser’s professional qualifications. Do you take photographs of the items being appraised? Yes, digital images are taken and embedded in the appraisal report. Does the Federal or State Government regulate personal property appraisers? No. Personal property appraisers are not regulated by government agencies as real property appraisers are. What is USPAP? USPAP stands for the Uniform Standards of Professional Appraisal Practice and reflects the latest appraising standards for appraisers of real estate, personal property and businesses. The International Society of Appraisers (ISA) requires their members to certify that they write their appraisals to these standards. Does the International Society of Appraisers (ISA) require recertification? Yes. Members must recertify every five years through testing and providing professional development points. Some information courtesy of the ISA brochure “Be Certain of Its Value”, a consumer’s guide to hiring a competent personal property appraiser.