Antique appraisals are provided by Sara Conklin, A Certified Antique Appraiser in Plumas County
Dear Sara:
Help! My husband died and all of our stuff has to be appraised. Harold bought a lot of pretty statues just before he died and the appraiser said the estate tax value was about what he paid for them new! I have sent a photo of one of the statues from the appraisal. Can you believe this statue is being taxed at about $11K? What can I do? Should I give some of them to a museum? Thank you. Carol
Dear Carol: You have brought up a very complex issue and I need to give you some background on appraisals for the Internal Revenue Service before I can give you any advice. Grab a cup of coffee girl and sit down. Sara
Appraising the contents of an estate to compute the estate tax owed and valuing a gift to a museum (charitable donation) in order to calculate a tax deduction, is a similar process to what the Internal Revenue Service (IRS) requires. The value definition to be used for both appraisals is Fair Market Value. Fair Market Value, as defined by the Internal Revenue Service in publication 561, is “the price that property would change hands between a willing buyer and willing seller, neither being under any compulsion to buy or sell, both having reasonable knowledge of the relevant facts, and with the sale being made to the public in the most relevant market taking into consideration the location of the property.”
Valuing fine art, decorative art and household contents is much like having your house appraised. Sales of similar types of items have to be researched. If several antique clocks sell for about $400 and they are just like the one in an appraisal, the appraiser can say the clock being appraised is worth $400. Market research is required to appraise personal property just like your house.
For most antiques, more sales occur in the national auction market than through specialist dealers and antique shows. As this relates to contemporary or newly created art, the relevant or most common market in many cases is not the auction market. The newly created art is usually purchased by people with disposable income, let’s say in their 50s. These “collectors” keep the item for say 20 years when it is then sold, upon their death, in a secondary market – typically at auction. Auctions usually sell things for less than when purchased new. In Harold’s case, the item has to be valued close to the time of purchase. The most common market then becomes sales to the public from the artists’ dealer or the artist themselves since no time has been allowed for the auction market to develop.
Sorry, as your appraisal notes, “Raindancer” by Tom Bennett, whose body of work has not yet come up for sale in the auction market – is indeed valued at close to what you paid for it. Perhaps giving it to a museum is a good move.
