PPA 2006 sets the specific definition for the credentials of a Qualified Appraiser and establishes the convention requiring the preparation of the appraisal in accordance with generally accepted appraisal standards as defined by theUniform Standards of Professional Appraisal Practice (USPAP) published by the Appraisal Standards Board of the Appraisal Foundation. Notice 2006-96, Section 3.03
Treasury regulations define an acceptable appraisal as:
- An appraisal must show effective value for a period no earlier than 60 days prior to the date of the gift or no later than the due date of the donor’s tax return
- An appraisal that is signed and dated by a “Qualified Appraiser“
- An appraisal that includes all required information
- An appraisal that does not involve a prohibited fee (based on the value)
The information that must be in a Qualified Appraisal includes:
- Description of the property
- A specific basis for the valuation
- A statement that the appraisal was prepared for income tax purposes
- A statement listing the qualifications of the Qualified Appraiser
- The appraiser’s signature and taxpayer ID number.
- An Appraisal Declaration – which includes a statement that the appraiser understands that a substantial or gross misstatement, that the appraiser knows, or reasonably should have known, would be used in connection with a return or claim for refund, may subject the appraiser to a civil penalty.