Qualified appraisal
A qualified appraisal is an appraisal of contributed property that meets federal requirements for preparation, signature, date, and appraiser qualifications. For owners of businesses, real estate, and private investments, the term describes a valuation document used in connection with a property contribution. The appraisal must identify the property in enough detail for an unfamiliar person to recognize it and describe its condition when the property is real or tangible personal property.
How it works
A qualified appraisal is prepared, signed, and dated by a qualified appraiser. When multiple appraisals are used, or multiple appraisers contribute to one appraisal, each appraiser must meet the applicable requirements and sign the qualified appraisal and appraisal summary.
Appraiser qualifications include limits tied to certain relationships and work patterns. An appraiser regularly used by certain persons described in the regulation, who performs a majority of appraisals for those persons instead of other persons, does not qualify. An appraiser also does not qualify for a donation if the donor knows facts that would lead a reasonable person to expect an overstated value.
Where it shows up for owners of businesses, real estate and private investments
A qualified appraisal appears in federal rules for donated property. Business interests, real estate, and private investments can be property whose identity and relevant condition need to be described in an appraisal when they are contributed. Condition must be stated for real or tangible personal property.
Federal guidance states that an exchange-reported cryptocurrency value does not satisfy the qualified appraisal requirement for a cryptocurrency contribution.
Common questions
How close to a contribution must the appraisal be made?
A qualified appraisal must be made within the permitted period before the contribution.
Does an exchange-reported cryptocurrency value count as a qualified appraisal?
No. Federal guidance states that an exchange-reported cryptocurrency value does not satisfy the qualified appraisal requirement for a cryptocurrency contribution.