DONATION APPRAISALS

In the event that an object is to be gifted to an institution, foundation, etc., and the piece is accepted by the donees, an appraisal for tax purposes is required for items over $5,000 in value.

What is a qualified IRS donation appraisal?

Pall Mall Art Advisors provides IRS compliant donation appraisals including the required 8283 tax form. The appraisal document includes full cataloguing, color images, illustrated comparables and full market analysis to justify the appraised value. The appraisal report also includes a narrative and details specific to the place of donation and object(s) being donated, in order to comply with IRS requirements.

Donations exceeding $50,000 are automatically reviewed by the IRS Art Advisory Panel. The Art Panel consists of industry specialists in all areas of collecting looking for appraisals conducted by qualified and independent appraisers, that meet all requirements set forth by the IRS.

PMAA Donation Appraisals include:

• Fair market value (FMV)
• Full cataloguing including: Artist/Make, Title, size, medium, age, and general condition along with any supporting details such as provenance, literary references and exhibition history
• Discussion of the current marketplace in relation to the types of objects being donated
• Narrative discussing the context of the place of donation and the objects to be donated

What is related use?

According to the IRS tax code, in order for a donor of tangible personal property to be able to take full advantage of a tax benefit, the charity must use the object in a manner that is related to its exempt purpose. Examples would be a painting donated to a university with an art museum and an educational program around the collection; a tall case clock created by a regional clock maker given to a historical society in that region. [1]

Sources used to determine fair market value and to provide narrative specific to the donation:

• Auction market for assessment of current market for the particular artist and/or type of work being valued
• Auction house records from international auction houses using several databases that search more than 12,000 sellers and 58 million global record
• Living artist and artist estates to confirm authenticity, editions, etc.
• International art fair reports
• Private collectors and advisors
• Over 75 contracted specialists familiar with global, national and regional market pricin
• Review of the donee’s collection and donation policies

[1] IRS Publication 526 (Cat. No. 15050A) Charitable Contributions