Discuss fees upfront and ensure they provide a written engagement letter outlining the scope of work, timeline, and deliverables. Be wary of appraisers who quote fees significantly below market rates or promise unusually fast turnaround times, as these may indicate corners being cut.
Once you've selected a qualified appraiser, your role shifts to ensuring they have everything needed to produce a defensible report. Gather all relevant documentation before the appraisal begins, including property records, previous appraisals, improvement receipts, and any legal documents affecting the property.
Clearly communicate the purpose of the appraisal and the effective date required. Estate appraisals typically use the date of death, but some situations may require alternate valuation dates. This timing affects which comparable sales the appraiser can use and how they analyze market conditions.
Appraisal TypeValue StandardTypical UseTimelineEstate TaxFair Market ValueIRS Form 7062-4 weeksProbate CourtFair Market ValueAsset distribution2-3 weeksTrust DistributionFair Market ValueBeneficiary allocation2-4 weeksInsuranceReplacement CostCoverage decisions1-2 weeks
Review the completed report carefully before using it for legal or tax purposes. Verify that all property information is accurate, the methodology is clearly explained, and all required USPAP elements are present. Don't hesitate to ask your appraiser to clarify any sections you don't understand or to correct any factual errors.
Getting a trust or will appraisal right the first time protects your family from costly disputes, legal challenges, and tax complications. By avoiding these seven critical mistakes and working with qualified professionals, you can ensure your appraisal serves its intended purpose and provides the documentation you need for a smooth estate settlement process. For those dealing with specialized assets, learning about different types and applications of equipment & machinery appraising can provide valuable insights into the appraisal process.
At AppraiseItNow, our certified appraisers specialize in trust and estate valuations, bringing the expertise and attention to detail these sensitive situations require. We understand the legal requirements, timing pressures, and family dynamics involved in estate settlements, and we're committed to providing USPAP-compliant reports that stand up to scrutiny.
Trust and will appraisals are essential for determining fair market value of assets at the date of death or transfer. They ensure equitable distribution among beneficiaries, satisfy probate court requirements, calculate accurate estate tax liability, and provide documentation that can withstand IRS scrutiny. Without proper appraisals, families risk disputes, tax penalties, and legal challenges that can cost thousands in additional fees.
Look for appraisers with recognized professional designations such as ASA (American Society of Appraisers), ISA (International Society of Appraisers), or AAA (American Appraisers Association). They must be USPAP-compliant and have specific experience with estate and trust valuations. Ask about their track record with probate courts and the IRS, and request sample reports to verify their methodology meets legal standards.
Most trust and estate appraisals take 2-4 weeks to complete, depending on the complexity and number of assets involved. Simple estates with a single residence may be completed in 2 weeks, while complex estates with multiple properties, business interests, or extensive personal property collections can take 4-6 weeks. Factors that extend timelines include poor documentation, scattered assets, and the need for specialized research on unique items.
Incorrect valuations can trigger IRS audits, require amended tax returns, and result in penalties or additional taxes owed. Undervalued assets may lead to underpayment of estate taxes, while overvalued assets can cause unnecessary tax burden. Family disputes often arise when beneficiaries question asset values, potentially leading to costly litigation. Executors and trustees may face personal liability for distributions made based on incorrect valuations.
