Excerpt from the Digital Journal of Advanced Appraisal Practice: Appraising Chinese Glass: A Guide to Objects & Connoisseurship

Fellow appraiser Sarah Reeder, ISA CAPP contributed an interesting and excellent article on how to work with high net worth individuals.

The article was included in the Spring edition of the Digital Journal of Advanced Appraisal Practice. I have included several sections in block quotes below from Sarah's article from her introduction and a portion from her section on working with estate planners, accountants and lawyers.

Sarah also discusses USPAP, insurance firms, family offices and collections management.

If you wish to read the full paper with images and citations, please visit our sponsor,  ISA Private Client Services landing page for the new Journal. Click HERE or follow the source link below to get access to view in flipbook form or to download a PDF of the new Journal.

The new Journal is getting a lot of online views and downloads. Currently the views and readership of the online edition remain strong and growing, now with nearly 1,200 views. I hope to publish a second edition this fall. Interested contributors should contact me with an article proposal. If you have an article contribution for the next edition please let me know.

From An Overview of the Many Ways that Appraisers Can Assist the Private Client Services Community by Sarah Reeder, from the Spring Edition of the Digital Journal of Advanced Appraisal Practice.
This article is an introductory overview of the many ways appraisers can assist the private client services community with an initiation to a discussion that I hope will be continued and expanded on in the future by my appraisal colleagues and our professional counterparts serving high-net-worth individuals.  Often one only considers calling in an appraiser if something has been damaged or a client passes away, but appraisers can be critically helpful for high-net-worth-individuals at every life stage.  Rather than a one-time service provider, I feel appraisers are more akin to an auto mechanic—experts with highly specialized knowledge to be checked in with regularly to maintain and protect one’s collection assets, just like routine scheduled oil changes with a trusted mechanic keeps a car running smoothly for years.

In the following article I will outline a range of ways appraisers can be of significant assistance to estate planning experts, accountants, lawyers, insurance firms, family offices, collection managers, and similar professionals serving high-net-worth individuals.  This list will not be exhaustive but is intended to expand the popular understanding of the breadth of expert resources appraisers can provide and help spark new future contributions to this ongoing conversation from my colleagues in the field.
Sarah continues
Estate Planning Experts, Accountants and Lawyers

Traditionally in the estate field one only considers bringing in an appraiser after a client has passed, but in reality appraisers are useful experts for estate professionals to collaborate with long before a client’s date of death.

Appraisers are critically useful for estate planning purposes as they provide the independent, objective perspective that can accurately assess that a treasured heirloom’s worth is limited to sentimental value, while the ignored painting no one likes hanging behind it is actually a rare masterpiece.  Having accurate valuation feedback about the art collections and other tangible personal property belonging to a high-net-worth client can help estate planning specialists better design the structure of estate plans to reduce tax liability and protect the interests of heirs.  Identification of which items are truly valuable in a financial context rather than a personal context is the best way to accomplish this, and also mitigates the chances of future conflict within the client’s family.  I’m sure nearly every appraiser has encountered assignments where the client’s family has argued bitterly over an item with an inaccurately perceived high value.  Getting a clear assessment about which items are monetarily valuable and which aren’t from a USPAP-compliant appraiser who is objective, independent, and has no vested interest in the outcome or appraised values is the best way to reduce these conflicts and help protect the estate holdings that do have high value.  For estate professionals specializing in high-net-worth clients, these items can be exceptionally valuable and may be better held for estate planning purposes in structures like art LLCs.

It can be useful to work with an appraiser quite early on in the estate planning process to catalog and provide a comprehensive assessment of the client’s assets if this has not already been completed as part of regular collection management.  This serves to document the tangible personal property assets in the client’s holdings and give the high-net-worth individual the opportunity to review each item in the collection together with estate planning professionals to determine the most appropriate course of action for each piece in the development of the estate plan.  Any potential complications that need a specialized treatment in the estate plan, such as a $50 million dollar painting, can be identified and mitigated early on rather than being discovered after the client’s death and triggering a tax burden for the estate that could have been reduced with informed preventative planning.  It also gives the estate planning professional a clearer picture of the client’s total net worth by quantifying the art and other tangible personal property, providing the opportunity to more accurately compare net worth across all asset categories against estate taxation thresholds and make appropriate adjustments to the comprehensive estate plan.
Source: Digital Journal of Advanced Appraisal Practice

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