As State of California Certified General Appraisers since appraisal licensing for Real Estate took effect in 1992, we frequently are asked the question from clients “What is a Designated Appraiser or a Qualified Appraiser?” In an effort to briefly explain the answers to this question, we will first outline in this newsletter the six main appraisal guilds that provide higher education to the professional appraiser in all appraisal disciplines. Most of this condensed information is taken directly from each of the Appraisal Guilds websites. At the end will be the IRS definition of a “Qualified Appraiser or Appraisal” according to IRS Circular 230.  

AMERICAN SOCIETY OF APPRAISERS (ASA) 

ASA is internationally known and a highly respected association

• The American Society of Appraisers was one of the eight original founding associations of The Appraisal Foundation. The American Society of Appraisers (the “Society”) is a multi-discipline non-profit international organization of professional appraisers (valuers).  The mission of the Society is to foster the public trust of our members and the appraisal profession through compliance with the highest levels of ethical and professional standards. 
• ASA is recognized by the Internal Revenue Service as well as other governmental agencies, financial institutions and the courts.
• ASA offers the necessary resources to develop the expertise needed to appraise diverse types of properties and handle the most difficult appraisal problems.
• ASA offers an on-line directory to locate the appropriate designated professional for your particular assignment, both nationally and internationally.
•  Is the only professional valuation organization that accredits members in every appraisal discipline. ASA works to grow the appraisal profession and fosters professional excellence in its membership through education, accreditation, publication and other services. ASA keeps an emphasis on professional ethics to protect the public.

Appraisal Disciplines that have higher education programs within the ASA Membership is:

• Appraisal Review and Management
• Business Valuation
• Gems and Jewelry
• Machinery and Technical Specialties (FF&E)
• Personal Property
• Real Property

Estate & Tax Planners

Qualified Appraisal           

Generally, if the claimed deduction for an item or group of similar items of donated property is more than $5,000, you must get a qualified appraisal made by a qualified appraiser. You must also complete Form 8283, Section B, and attach it to your tax return. 

According to IRS regulations, a qualified appraisal is an appraisal document that:

• Is made, signed, and dated by a qualified appraiser in accordance with generally accepted appraisal standards,
• Meets the relevant requirements of Regulations section 1.170A-13(c)(3) and Notice 2006-96, 2006-46 I.R.B. 902 (available at www.irs.gov/irb/2006-46_IRB/ar13.html ),
• Relates to an appraisal made not earlier than 60 days before the date of contribution of the appraised property,
• Does not involve a prohibited appraisal fee, and
• Includes specific information

Qualified Appraiser 

According to IRS regulations, a qualified appraiser is an individual who meets all the following requirements:  

1. The individual either:

1. Has earned an appraisal designation from a recognized professional appraiser organization for demonstrated competency in valuing the type of property being appraised, or

1. Has met certain minimum education and experience requirements. For real property, the appraiser must be licensed or certified for the type of property being appraised in the state in which the property is located. For property other than real property, the appraiser must have successfully completed college or professional-level coursework relevant to the property being valued, must have at least 2 years of experience in the trade or business of buying, selling, or valuing the type of property being valued, and must fully describe in the appraisal his or her qualifying education and experience.
2. The individual regularly prepares appraisals for which he or she is paid.
3. The individual demonstrates verifiable education and experience in valuing the type of property being appraised. To do this, the appraiser can make a declaration in the appraisal that, because of his or her background, experience, education, and membership in professional associations, he or she is qualified to make appraisals of the type of property being valued.
4. The individual has not been prohibited from practicing before the IRS under section 330(c) of title 31 of the United States Code at any time during the 3-year period ending on the date of the appraisal.
5. The individual is not an excluded individual. 

Why you need an ASA Real Property Accredited Appraiser

ASA designated appraisers have completed rigorous education requirements, must adhere to high ethical and moral standards, and have extensive and specialized appraisal experience to meet your demanding needs. You can be assured that all members having achieved the RM or ASA designation have these qualities.

• ASA accredited appraisers possess qualifications superior to those of a State Licensed or State Certified Appraiser.
• ASA accredited appraisers are required to pass rigorous testing and meet demanding education and experience qualification standards prior to being awarded the designation.
• ASA accredited members are required to maintain higher standards of Ethics and Educational requirements over State certified or licensed appraisers and are subject to disciplinary actions for lack of adherence to these standards.
• An ASA’s appraisals meet or exceed the standards of peer review.
• An ASA has taken a comprehensive exam in addition to the exam required for state licensing
• Many ASA Real Property Members are cross-certified in other disciplines or have additional education in disciplines such as Business Valuation or Machinery and Equipment.  

APPRAISAL INSTITUTE (AI) - DESIGNATED MEMBERSHIP

What are the MAI and SRA designations?

• The MAI designation is held by appraisers who are experienced in the valuation and evaluation of commercial, industrial, residential and other types of properties, and who advise clients on real estate investment decisions.

• The SRA designation is held by appraisers who are experienced in the anlaysis and valuation of residential real property.

The American Society of Farm Managers and Rural Appraisers is a professional organization for property economic professionals who provide management, consultation, and valuation services, as well as real estate services on rural and agricultural assets. All members of the Society work under a professional code of ethics, which includes continuing education requirements.

 The ASFMRA, founded in 1929, provides members with the resources, information, and leadership that enable them to provide valuable services to the agricultural community.      

Accreditation Overview

Many ASFMRA members carry the distinction of being accredited, the highest recognition given by the society. This designation is achieved only after years of professional service, many rigorous hours of education and comprehensive testing conducted by the Society. Accredited designations include:

• Accredited Farm Manager (AFM)
• Accredited Rural Appraiser (ARA)
• Real Property Review Appraiser (RPRA)
• Accredited Agricultural Consultant (AAC)

ASFMRA professionals offer expertise in biotechnology, environmental issues, changing technology, land, property, and business valuation, market trends, and governmental involvement and regulations.

INTERNATIONAL RIGHT OF WAY ASSOCIATION

What is the SR/WA Designation?

The Senior Right of Way Professional (SR/WA) is the most prestigious professional designations granted to those right of way professionals who have achieved professional status through experience, education, and examination.

While the SR/WA professional may be a specialist in one area, they must also be familiar with all disciplines associated with the right of way profession. The SR/WA designation is the only designation reflecting evidence of professional accomplishment in the right of way profession.

NATIONAL ASSOCIATION OF INDEPENDENT FEE APPRAISERS

The National Association of Independent Fee Appraisers is an association of professional real estate appraisers committed to the support of its members, for a service of trust and integrity that benefits the members, the profession and the general public.

The Association was founded in 1961 as a non-profit association of professional real estate appraisers. Today, the Association has chapters throughout the United States and Canada, as they continue to expand their market outreach.

Designation Overview

NAIFA's designation program was formed, in part, to provide assurance to clients that they are engaging a qualified, experienced, competent appraiser, an appraiser having up-to-date education and knowledge of the profession's standards. 

The National Association of Independent Fee Appraisers, a founding member of The Appraisal Foundation, awards its designations to appraiser Members who have successfully met its rigorous requirements. Designated membership categories are: IFA, IFAA, IFAS, and IFAC.

RICS – ROYAL INSTITUTION OF CHARTERED SURVEYORS

A global member organization for professionals in property, land, real estate, construction and related environmental issues. To ensure that members are able to provide the quality of advice and level of integrity required by the market, RICS credentials are:

• MRICS
• FRICS

These titles are awarded to individuals who meet the most rigorous requirements for both education and experience.

IRS REFERENCE INFORMATION

The following information is taken from the Treasury Department Circular No. 230 (Rev.4-2008) Cat. Num. 16586R www.irs.gov.  Regulations governing the Practice of Attorneys, Certified Public Accountants, Enrolled Agents, Enrolled Actuaries, Enrolled Retirement Plan Agents, and Appraisers before the Internal Revenue Service.

General Information – Frequently Asked Questions

What is the Office of Professional Responsibility (OPR)?

The Office of Professional Responsibility (OPR) enforces the regulations governing the practice of attorneys, certified public accountants (CPAs), enrolled agents, enrolled actuaries and appraisers before the Internal Revenue Service (IRS) as set forth in Treasury Department (Circular No. 230). In addition, OPR reviews applications from individuals who wish to become an enrolled agent or enrolled actuary.

What is the mission of OPR?

The mission of OPR is to Roster excellence in tax professional services by setting, communicating, and enforcing standards of competence, integrity and conduct.”

What is Circular 230?

Circular 230 provides the regulations governing the practice of attorneys, CPAs, enrolled agents, enrolled actuaries, and appraisers before the IRS.