After a person passes away, there are many aspects of estate administration that must be taken care of to settle the deceased person’s affairs. Estate appraisals often play an important role in this process, particularly for large estates or those that have unique assets. These appraisals help to determine the value of assets, including real estate, personal belongings, investments, and more.
Not all estates require a formal appraisal, but they are necessary in many cases, and they are useful in many ways. An estate appraisal can be used to:
- Calculate Estate Tax – To determine if federal or state estate taxes are owed, it’s essential to know the estate’s value. A third-party appraiser can provide an independent, unbiased, professional valuation.
- Distribute Assets to Beneficiaries – Distributing assets to heirs or beneficiaries is a key component of estate settlement. To do so fairly, an estate appraisal is needed to first establish the value of the assets.
- Step-Up in Basis – This tax provision resets the cost basis of an inherited asset to be adjusted to its fair market value on the day of the former owner’s death, which may eliminate or reduce capital gains depending on if the asset is sold immediately or later. To reset the cost basis to the day of death, an estate appraisal is needed to determine the fair market value.
Do you need an estate appraisal? You can trust our team at C and J Appraisal Company, LLC to provide it. Contact us today.