Page 167 - Washington Nonprofit Handbook 2018 Edition

entity level, but if they are not satisfied, the deduction is denied at the partner or
shareholder level.

A qualified appraisal is an appraisal satisfying requirements established by
the Treasury or IRS. See Code section 170(f)(11)(E). An appraisal is qualified if it
meets four requirements. See Treas. Reg. section 1.170A-13(c)(3)(i).

• First, it must be made not earlier than 60 days before the gift or later
than the due date (with extensions) of the return on which the
deduction is claimed.

• Second, it must be made by a “qualified appraiser,” who must sign and
date the appraisal report. To be qualified, an appraiser must declare
in the report that he or she:

y Performs appraisals regularly or holds himself or herself out to
the public as an appraiser;

y Is qualified to appraise property of the type involved;

y Is not the donor, the donee, the person from whom the donor
acquired the property, or a person employed by or related to
any of the foregoing; and

y Understands that an intentionally false or fraudulent appraisal
subjects him or her to penalties.

• Third, a qualified appraisal must be embodied in a report that contains
several items of information. See Treas. Reg. section 1.170A-13(c)(3)(ii).

y The report must describe the property sufficiently so that a
person other than an expert can tell that the property appraised
is the donated property.

y If the property is tangible, the report must describe its physical
condition.

y Any agreement or understanding limiting the donee’s use of the
property must be described.

y The report must state the appraiser’s name, address, and
taxpayer identification number, describe the appraiser’s

WASHINGTON NONPROFIT HANDBOOK -156- 2018