An appraisal is crucial for estate planning as well as valuation for tax purposes. It is always best to have an accurate and up-to-date appraisal when any property is involved. Having a current appraisal helps you keep better track of your financial assets rather than estimating from an outdated appraised value. Properties can often increase in value, and they can decrease just as easily.
For estate planning, appraisals can help determine the values of assets. This knowledge is indispensable for heirs if properties and assets need to be gifted or divided after a death. Keeping an up-to-date appraisal on file is also handy when determining the increase of property value as well as growth or loss margins. Being able to see steady growth or loss over time can help determine proper selling and buying values for good investment opportunities.
Appraisals are also helpful for tax purposes. Having an accurate appraisal can help in the case of a tax audit. Many privately owned businesses are required by the IRS to have an appraisal for determining values if claimed on tax returns. Appraisal costs are often tax deductible, so check with your tax preparer to determine if that works in your situation.