Appraisal Reports for Every Purpose

Insurance

  • AFAA prepares professional appraisal reports that document the current Retail Replacement Value for each item. Insurance appraisals are intended to represent the value it would take to replace the whole collection quickly in the event of a major loss. In the event of loss or damage, your insurance company will require proof that the item existed and the value of that item at the time of loss. Appraisal reports are a key component in documenting and protecting your fine art investment.

  • Most Insurance companies will require an appraisal for items valued over $5000.00, but some as low as $2000.00 and others more accustomed to fine art coverage, only require an appraisal on items over $50,000.00.  Check with your insurance carrier. A competent report will catalogue and record all details of the artwork including its provenance and condition. The appraiser will also research the market value of the item and archive the comparable sales in the client file which will be retained by the appraiser for a minimum of five years.

  • Our standard practice is to inspect the property in person and then return to the office to conduct market research. In many cases, we are also able to complete the appraisal online with images, descriptions and documentation provided by the client.

Estate Valuation

  • Executors, trustees, heirs, attorneys and fiduciaries rely on AFAA to identify, research and value works of art for estates of all sizes; before and after death.

  • For federal estate tax purposes, transferred property must be reported at Fair Market Value. The IRS requires a "qualified appraiser" to appraise each work with a projected value above $3,000.00. Every state varies on estate tax rules, so check with your accountant. AFAA is a qualified appraiser for the IRS.

  • AFAA has no financial interest in the property being appraised because we are not affiliated with a venue that is selling the property for profit. This allows us to value the property completely objectively, in line with the current market.

  • For estates where the identity, quality and provenance of the works is sparse or unknown an initial “walk-through” is recommended. We prefer to personally inspect the works but will review images and data sent by email in some instances. We assist you to identify those works that could have significant value and warrant further investigation, as well as those that do not.

  • For estate collections where the items are well documented and of known value, we prepare the appropriate report, suggest the most appropriate venue for sale or recommend institutions where a donation of the item could be accepted.

Damage and Loss

  • AFAA can be engaged for damage and loss appraisals by the owner of the property, by the insurance broker or the insurance carrier. In the event of damage or loss, AFAA can provide pre-loss, post-loss, post-restoration and loss-in-value appraisals to aid the insurance claim process.

  • The participation of a qualified appraiser should be considered in most fine art claims where loss or damage has occurred. Often, the services of a professional conservator are also required. The use of an objective third party can be important in the claims settlement process.

  • The appraisal should state the value of the item prior to damage. The report might also suggest the anticipated value of the damaged artwork when the recommended conservation treatment has been performed.

Donation

  • AFAA prepares IRS compliant donation appraisals for clients, museums and institutions across the United States.

  • According to IRS Regulation 561, all artwork donations must meet specific criteria: The IRS mandates that a charitable contribution of an item or items with a Fair Market Value of more than $5,000.00 must have a "qualified appraisal" by a "qualified appraiser" attached to your return. For items valued at $50,000.00 or more the IRS will submit the appraisal to the Art Advisory Panel for additional scrutiny and evaluation. If possible, choose to donate a property whose value would be assessed as a long-term capital gain rather than ordinary income.

  • Remember the "IRS related use rule": Make sure your gift is intended for a qualified public charity whose mission is in alignment with art . Typically, art contributions are made to qualified organizations that are museums or educational institutions that have public charity status. The tax benefit of the donation could be significantly compromised if the charity sells the item or does not make it available for viewing for a minimum of 3 years following the donation.Request an official deed of gift from the qualifying charity, describing the property and specifying the date of the donation. Be sure to share your intentions to make a gift with your CPA or tax professional and submit all materials for his or her review prior to posting your tax return.

  • Qualified fair market value appraisal reports for IRS charitable contribution are among the most demanding documents an appraiser is asked to produce. They require considerable time to prepare and must include specific elements to be accepted by the IRS. Most importantly, you should select an appraiser who has established expertise in the specific type of artwork you are intending to donate and is member of an accredited appraisal organization. All donation appraisals must meet the relevant requirements of Internal Revenue Regulation §1.170A-13 (c)3 and the requirements of IRS Revenue Procedures 66-49 and Publications 526 and 561.

Purchase and Sale

Purchase advice:

AFAA’s Pre-Purchase Report assists clients to make well informed buying decisions on paintings, works on paper and sculpture from 1800 to the present. (Please note that works of art under $10,000.00 are not optimal candidates for this service.)

The following questions should be asked prior to any significant art purchase:

  • Is this a typical work by the artist? Is it a good example of the subject, medium and style for which he or she is best known?

  • Is there an established secondary market for the artist beyond the individual gallery or dealer exhibiting the work? What is the selling dealer’s reputation among his peers? Has the artist sold at auction? Has this specific work sold at auction? If so, for how much and when?

  • Is the artist represented in noted museum or private collections? Has the work been included in books, periodicals or noted exhibitions?

  • What is the physical condition of the work? Has it undergone treatment or conservation of any kind?

  • If it is a work from an earlier era, is there provenance, exhibition history or literature that documents or illustrates the work?

  • Does the work have clear title? Is the seller authorized, in writing, to offer the work for sale? Has the work been checked in the Art Loss Register database of stolen property?

Our Pre-Purchase Report provides the data you require to make a confident and informed buying decision. In many instances, our reports have assisted clients in negotiating a reduced purchase price.

It is important to recognize, that despite the best research and due diligence, many works of art do not hold their value or appreciate in value.

However, your passion for the artwork, along with our professional research, can help ensure the best possible addition to your collection within your budget.

Sale advice:

AFAA assists clients to sell fine paintings, works on paper and sculpture. Over many years, we have established and maintained worldwide relationships in the fine art trade. Some works are best suited to offer through dealers or private transactions, while others may benefit from the wider exposure that an auction house can provide.

  • Prior to offering your work for sale, AFAA will research the current market, carefully assessing similar works that have sold privately and at auction over the past several years.

  • We will objectively review the quality of the work including the stature of the artist, desirability of subject, physical condition and provenance.

  • We advise on venue placement, estimates, contracts and logistics to help ensure the most timely and favorable outcome for the sale of your property. Please note, AFAA does not warrant and cannot guarantee the sale of any item.