The recent surge in the popularity of television programs like PBS' Antiques Roadshow and the Home and Garden Television's Appraise It! has induced many people to become interested in the value of their personal possessions. While appraisal fairs and Internet appraisal services such as the CollectingChannel.com satisfy the general curiosity for "what's grandma's glass vase worth?," they do not address the need to formally document the estimated value of that glass vase for purposes of indemnifying it in an insurance policy; dividing it as part of an estate; or making a (tax-deductible) donation to a favorite museum.
What types of items should I consider having formally appraised?
This is a complex question, but a good initial answer is:
1. items for which values may not be more readily obtained by other means, such as original artwork; and
2. any item of special importance to you for which no commonly-recognized current market exists.
Some of the most commonly appraised items include:
- fine art
- fine Native American crafts
- fine antique furniture
- collectibles (dolls, coins, trading cards, etc.)
- fine china, porcelain and glass
- sterling silver flatware and hollowware
- antique firearms, cameras and mechanical apparatuses
- musical instruments
rugs & textiles
So why should I have these items formally appraised?
Many of these and other types of items only have limited coverage in a standard homeowner's insurance policy and require additional coverage. For specific policy limits and guidelines for when a formal appraisal is necessary, consult your insurance advisor.
Even if a formal appraisal is not required, it is a good idea to do a home inventory. There are a variety of good home inventory programs written for your PC. You may also click here for a sample household inventory form , which you can print and copy. In the event of a emergency, you will have an itemized list of your most valuable possessions. Many of these items are also among the most often forgotten after a disaster such as a fire.
Additionally, some of these items can be of significant value and may need to be appraised for estate planning purposes, including inclusion in personal trusts. When planning your estate with an attorney and/or accountant, it is wise to settle any dispute among your heirs. An appraisal of those items will give you a good idea of what they are worth so that you may make more informed decisions regarding the disposition of your estate. It's a good idea to include all items of significant value as well as items that may be the subject of interest.
If you donate an item to a not-for-profit organization such as a museum, the Internal Revenue Service may require you provide an appraisal of the donated item, especially if it is over a certain value. For more information on whether you need to obtain an appraisal for a donation, please contact your accountant or visit the Internal Revenue Service on the web.
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IRS Form 8283 Instructions
IRS Form 8283
What is a professional personal property appraiser?
A professional personal property appraiser is a market analyst trained in the valuation of personal possessions, such as jewelry or art, who has been educated and tested according to the professional and ethical standards of one of the major appraisal associations.
When evaluating the qualifications of a personal property appraiser, one important factor is whether the appraiser is an accredited member of at least one of the major appraisal associations. These associations include:
International Society of Appraisers
Appraisers Association of America
American Society of Appraisers
You'll also want to ask the appraiser how familiar he or she is with the specific type or types of objects to be appraised; ask about their specialties; assess whether the appraiser has enough professional experience to have a grasp of the economic cycles that affect the markets; and determine whether the appraiser is articulate and easy to understand. And, finally, ask to see the appraiser's resume, references and even a sample report.
Some appraisers may also tell you that their reports follow the stringent standards of USPAP. The Uniform Standards of Professional Appraisal Practice or USPAP are a set of guidelines and ethical standards for appraisal practice written by the Appraisal Foundation with input from the appraisal field. Most of the major appraisal associations require their membership to conform to U.S.P.A.P. Having your personal possessions professionally appraised can protect you in a variety of situations. While the cost of a formally written appraisal may seem prohibitive, it is important to weigh that cost with how important your personal property is to you and your ability to defend its monetary value when filing a claim on an insurance policy or deducting the value of a donated item on your taxes. Like maintaining an automobile, many people put off having their valuables appraised until there is a emergency, when it might be too late.
Identifying a personal property appraiser is like searching for any other professional service, so don't hesitate to ask for credentials and references.