Date of death appraisal

[PropertyEconomics]

PE,

For any report, USPAP requires that the contents be meaningful and not msleading to the users that I intend. If I identify multiple intended users, I am obligated to meet the needs of all of them. I prefer to meet the needs of a few, especally if it doesn't change the fee

If the heirs are the only intended users, then I can interview the heirs and get a sense of their level of knowledge and familiarity with the property, and customize the report content to match their knowledge level.

For example, I recently did an estate appraisal for a property in Nashville. The only heir grew up in the subject property and stilll lived a few blocks away. So, in the report I summarized the neighborhood description, but did not include the kind of detail I might have if the heir lived out of town.

Of course, none of this changes the fact that I still have to consider the intended use, and I think that neighborhood description was sufficient for the intended use.

The fewer the intended users, the less my obligation and the less likely I am to inadvertently not address something I need to address. I seldom name anyone other than the client as an intended user. Call it a matter of risk management.

Danny

I couldnt agree more with your statements Danny. I dont name the heirs as a user because typically I cant interview them all, the level of knowledge that they each have is very difficult to determine thus I typically name the executor of the estate as my client. I have named the other users because I know they will in fact use the report. Perhaps I need to rethink my position and your words are very wise.

 

[Kevin Mc]

I particularly like the statement that no other use or user is intended by the appraisers. I personally do not name the IRS as an intended user.

I agree. I also do not name the IRS. PE nailed it, My Intended User comment is nearly identical although I state it the as "date of passing". I tend to sugarcoat things

 

[DWiley]

I really like the idea of only naming the executor. Reduces risk even more.

DW

 

[Jim Buckner]

I agree with Mr. Wiley. I show the client as the "estate of ..." with other intended users as the heirs of the estate. The intended use is related to the settlement of the estate. I know that the IRS may be part of that estate process but I do not include them specifically.

 

[PropertyEconomics]

I agree with Mr. Wiley. I show the client as the "estate of ..." with other intended users as the heirs of the estate. The intended use is related to the settlement of the estate. I know that the IRS may be part of that estate process but I do not include them specifically.

Jim my thought is this ... if one of the heirs is a 2 year old, how can you write the report so that heir is a user of the report and the report is something they can understand? Its an interesting issue and that is the resason I only name the executor. They can explain it to the heirs, depending upon his understanding of their level to understand.

 

[Richard Carlsen]

I use "estate settlement purposes" which lets then use the report for several things which is what the client normally wants.

Whatever you put in the report, the client will do whatever they want with the appraisal including lay it on the dining room table for a prospective buyer to read. I've had a couple of buyers call me and want a copy so they could use it for financing when they bought a property privately out of an estate.

 

[Laughing Heir]

I should clarify, on our engagement letter for estate assignments, it does not ask for a list of the heirs, rather, we intend to find out the name of the executor or executrix.

I love this forum. And I really love it when a topic is discussed and different sides of it are approached. I can't imagine a better environment to learn in, unless I had all of you following me around all day like my Verizon network.

 

[Jim Buckner]

I think our profession is often our own worst enemy. We are required to be overly technical when it comes to naming who the hell are the clients, users and uses. The process is about getting the correct value foremost and that seems to get lost in USPAP too often. I apologize for the grumblings of this old appraiser.

 

[Terrel L. Shields]

Often the only reason for a DOD appraisal is establish a tax basis and the IRS does not 'review' that except where taxes are due. Its not my job to determine if there are due taxes.

The purpose is to determine the value as of dd/mm/yyyy for estate planning purposes. The intended users are the trustee, heirs, estate and its agents or advisors.