As of August, 2006, rules governing charitable contributions, estate tax reporting, appraisers and appraisals were changed by the Internal Revenue Service (IRS). While still not formalized by Congress, and undergoing some additional revisions, readers of this section are advised to access the IRS website for updates. If you are considering an appraisal related to estate, gift tax or charitable contribution, consult with an attorney and/or accountant with specific expertise in the field. Any qualified appraiser will be suggesting that you do so after discussing your particular matter and the services to be provided. The last thing you want is to go through the process only to find that the appraiser was not qualified and the appraisal did not meet current standards.

A USPAP compliant appraisal is required to state any limitations regarding client identity (even if by number of file), name intended users of the report, and state the type of value and the intended use of the report. The appraiser is also required to state if there is any past, current, or contemplated financial interest in the property being appraised and must state if there was any appraisal involvement with the property in the three years preceding the current appraisal.

If you are making a non-cash charitable contribution to an organization that is going to sell the property being gifted in less than three years, or if there is no "related use," the charitable contribution will be ultimately limited to cost basis or the amount for which the property is sold, whichever is the lesser amount.