After a five-year effort, the American Society of Appraisers is taking credit for some of the provisions contained in the Pension Protection Act of 2006.
Signed into law in late August, the bill includes language that states only "qualified appraisers" will be eligible to submit appraisals for charitable gift tax purposes. Future appraisals will also be required to conform to the generally accepted appraisal standards for all professional appraisers.
In recent years, several members of Congress have called into question the fairly wide-ranging rules governing the appraisal business and who could submit valuations to the Internal Revenue Service. Under the new law all appraisers who submit appraisals for tax purposes will be held to a higher level of accountability with the IRS and both appraisers and taxpayers will face increased penalties for valuation misstatements.
A wide variety of private and corporate tax returns will be affected, including personal income tax returns, estate and gift tax returns and corporate tax returns. In addition to business valuation, the new legislation also affects the full range of appraisal disciplines, including personal property, real property, gems and jewelry, and machinery and technical specialties.
The next step is for the IRS to implement the law through new regulations and changes to tax forms. In a statement, the ASA said that it will be actively engaged in the implementation of the law.
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