Do I Need a Date of Death Appraisal?

If you have recently lost someone and are in the process of sorting out their estate, you have probably heard that you need a “date of death appraisal,” which is used to determine how much, if any, estate tax is owed to the IRS. This is an important house doctorpart of settling the estate and is also used to determine the new income tax basis for whoever inherits the home.

What makes a date of death appraisal different than a “normal” appraisal? Though it seems strange, the home is valued retrospectively, which means that the value is determined as of a specific date in the past. This can be done whether the value is needed for last week, last month, or even years ago. This is done in much the same way that a house is valued in the present, by using comparative sales, market trends, and comparative market data at the date of death.

Sometimes date of death appraisals are required for homes that haven't been lived in for decades.

Sometimes date of death appraisals are required for homes that haven’t been lived in for decades.

We are Certified Residential Appraisers who have done many appraisals of this kind and appraisals for the IRS, which means we are highly qualified for these valuations. The IRS defines qualified appraisers and appraisals here.

However, we understand that most date of death appraisals are needed at emotionally sensitive times, and we try to be as understanding and sensitive as possible. We value our clients and appreciate the opportunity to help you sort through a difficult time. If you need a date of death appraisal, feel free to give us a call for a free quote, or fill out our contact form right now. We’d love to help you out.

Comments

  1. Thank you for sharing Jeff. Sometimes people think they don’t need a date of death appraisal because they don’t plan to sell, but then ten years down the road, they realize that if they sell without a date of death appraisal they will need to pay tax on the entire value, rather than just the increase in value. Even if the estate is going to stay in the family, it is a good idea to get the appraisal now. I had a client who needed me to do a retrospective appraisal from almost twenty years ago. Due to the research, this will be an extremely expensive appraisal and probably will not be as accurate as it would have been if done closer to the date of death.

    • Jeff Hamric says:

      Wow, 20 years. That would be a challenge. The oldest one I did was 5 years. Thanks for the comment. The tax implications for waiting can be massive!

  2. Jeff-
    This is a nicely stated blog post. I’m going to print it and or forward link to clients that have recent decedents.

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