Appraisal Story: Accidental vs. Mistaken vs. Fair Sales & Gifts to Institutions

*This story is based on an appraisal experience by Lynn Magnusson, ASA, AAA. For confidentiality reasons, details of the assignment have been changed.

Not every object you gift or sell to an institution or 501c3 requires a formal appraisal for the IRS.  In fact, you would only need one IF you were planning on taking a significant tax deduction. However, it can be in your best interest to get an evaluation of what you intend to donate or sell to them BEFORE it’s a done deal.

Years ago, I did an appraisal for an institution which had purchased a small hand-crafted wood they were offered. They told me that they thought it might be “something" and wanted to insure it properly. My market research showed them that the “little table” wasn’t so little after all!  It needed to be insured for $40,000!Post appraisal there were obviously several conundrums to address. Should the institution notify the seller of this information?  Should they return it if the seller discovered it's significance and wanted it back?  Had the seller at least received a verbal consultation beforehand, they could have at least made an educated decision.  Sellers Beware, too!Contact the Magnussons to speak about your personal property donation today:973-425-1550

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Co-Authors: Lynn Magnusson, ASA, AAA and Becky Lipnick, Communications Coordinator