New Adequate Disclosure Regulations Issued for Gift Tax Returns

The new Internal Revenue Service regulations state that the period of limitations on the assessment of a gift tax will begin only if there is adequate disclosure. The adequate disclosure requirements will be considered satisfied if the donor submits an appraisal of the gift prepared by a qualified appraiser.

• A qualified appraiser is one who:
  • Holds him/herself out to the public as an appraiser, or performs appraisals on a regular basis,
  • Has the appropriate background experience,
  • Has the appropriate education, and
  • Is a member in a professional appraiser association.
    
    
• The appraisal report should contain:
  • The date of the transfer,
  • The purpose of the appraisal,
  • A description of the property and the appraisal process employed,
  • A description of the assumptions used,
  • A description of any limiting conditions and restrictions on the transferred property that affect the analyses, opinions, and conclusions,
  • The information considered in determining value,
  • All financial data that was used in determining the value,
  • The appraisal procedures followed,
  • The reasoning that supports the analyses, opinions, and conclusions,
  • The valuation method used,
  • The procedure used in determining the fair market value,
  • Specific comparable sales or transactions considered.

The professionals at VSI are qualified appraisers and our reports will satisfy all of the adequate disclosure requirements.