IRS and the Qualified Appraiser

In yesterdays post I included some basic information from the Code of Federal Regulations on the IRS's interpretation of the Pension Protection Act and guidelines for what constitutes a qualified appraisal for charitable donations. Today's post deals with basically the same issue but instead of looking at a qualified appraisal, we look at what the IRS considers a qualified appraiser. Scroll down to read yesterdays post on qualified appraisals. Click HERE to an August 11 AW post which has a link to the newly published Code of Federal Regulations.

In general, under the proposed regulations, a ``qualified appraiser'' must be an individual with verifiable education and experience in valuing the relevant type of property for which the appraisal is performed. The PPA refers to two types of education and experience: Minimum education and experience in section 170(f)(11)(E)(ii)(I) to establish qualification as an appraiser generally, and verifiable education and experience in valuing the type of property subject to the appraisal in section 170(f)(11)(E)(iii)(I) to establish qualification as an appraiser for a particular appraisal. The IRS and the Treasury Department believe that it is sufficient for an appraiser to satisfy the more stringent requirement of verifiable education and experience in valuing the type of property subject to the appraisal. Satisfaction of that requirement will also satisfy the minimum education and experience requirement of section 170(f)(11)(E)(ii)(I). The proposed regulations provide that an individual has verifiable education and experience if the individual has successfully completed professional or college-level coursework in valuing the relevant type of property and has two or more years experience in valuing that type of property. Furthermore, because significant education and experience are required to obtain a designation from a recognized professional appraiser organization, under the proposed regulations appraisers with these designations are deemed to have demonstrated sufficient verifiable education and experience.

If I am interpret the above guidelines correctly, should the appraiser have a designation from a "recognized professional appraiser organization" the appraiser is considered to have both the necessary education and experience. Although this is only my opinion, it appears that the educational requirements for an appraiser with a recognized designation will have an easier time establishing as a qualified appraiser than someone without. Those without the designation will have to prove two or more years of appraising similar property to cover the experiential portion and verify college or professional level education as well in appraising similar property.

The proposed guidelines certainly support the "recognizable appraisal organizations, which I would assume to be ISA, ASA and AAA. If you are preparing charitable donations appraisals for the IRS on a regular basis, and are not designated by a major appraisal organization, I would highly recommend that you join and go through the various credentialing processes to become a qualified appraiser.