Have an offer to do a rush appraisal? Dave Atlas tells you about the possible consequences of saying yes.

Lawyer: ?I need a quickie estate appraisal for settling an estate. I am up to the time limit and this estate was a very large one. Can you help me out fast?? 

Appraiser: ?I really could use the work right now.? 

I hope you do have the knowledge about how to respond to an attorney who claims to be in a hurry. If you are wondering what you might say or do, please read further. We all should know that decisions made on the spur of the moment often are just impulsive and not proper ones. Here we have a situation where making a wrong choice might adversely affect your future. This decision should be an easy one to make, but without the facts you could make a poor choice. 

What do you need to do for an appraisal of a large-dollar-value estate? You need to come up with fair market values based on the most common market for the items appraised in an arm’s length transaction. You need comparable sales data, not just your opinion. You need to back up your findings with evidence. You’ll need several statements as to how you arrived at your valuation and several more about the intended use and limitations of use of the report. Do you know the penalties for under-valuation? Do you know you can be barred from appraising for federal agencies? Are you prepared to defend your findings? This is a minimum of what you must anticipate if you accept the work. There is far more still to getting such a job done correctly.  

Appraisal associations teach what must be incorporated into an estate appraisal subject to federal review. There are details in these reports that do not need to be present in insurance appraisals. An estate appraisal for determining the value of items taxable under the current federal inheritance tax laws is a very special appraisal service. I have seen estates pay way too much tax because the appraiser was fearful of being too low. I have seen appraisers or estates have problems because the values were too low.  

I have also seen situations where the value was right, but the comparables or evidence of value research was missing or inadequate. Not only does the estate then have problems, the appraiser has problems, too. It can be a warning, a fine or worse.  

While we may occasionally joke about the IRS, the matter of what an appraiser’s responsibilities are when performing this sort of appraisal is quite a serious matter. It takes several days in the classroom to discern the techniques required to comply with the needs of these clients and to protect one’s own anatomy from foreseeable repercussions. 

The message of all this is quite clear. Don’t do these reports if you are being rushed. Never think about doing them if you are untrained. Get the education if you want to accept this work. Insist on independence and sufficient time to create the reports. 

There is absolutely no alternative.