According to the Canada Revenue Agency rules, if you take a tax deduction for a non-cash charitable contribution, you must get a qualified appraisal if the deduction claimed is $1,000 or more.
A fair market value appraisal is the only type acceptable to the Canada Revenue Agency. The generally accepted meaning of fair market value is "the highest price, expressed in terms of money, that the property would bring in an open and unrestricted market between a willing buyer and a willing seller who are both knowledgeable, informed and prudent, and who are acting independently of each other". (Gifts and Income Tax, Canada Customs and Revenue Agency, P113 (E) Rev. 98).
Donations of property to registered charities qualify for a tax credit based on 75% of the fair market value of the property. Capital gains taxes must be paid on the difference between fair market value and purchase price.
For the Canada Revenue Agency, the appraiser must be a well-recognized professional, qualified to certify their appraisals. For the Canada Revenue Agency, a qualified appraiser is an individual with verifiable education and experience in valuing the relevant type of property for which the appraisal is performed.
I am accredited with the International Society of Appraisers (ISA) as a personal property appraiser with a specialty in fine art. I have received formal training and passed the examinations in appraisal theory, principles, procedures, ethics and the law. My appraisals are written in accordance with the Appraisal Foundation's Uniform Standards of Professional Appraisal Practice and the Code of Ethics and Report Writing Standard of the ISA. I am qualified to certify my appraisals according to the Canada Revenue Agency rules.
My well-written, professional appraisals will satisfy the rigorous demands of the Canada Revenue Agency.
Cultural Property Donation Appraisals
According to the Canada Revenue Agency rules, for deemed cultural property, you will require only one appraisal when the estimated fair market value (see above) of the donation is $20,000 Canadian or less. If the donation is above $20,000 it will require two appraisals. If two appraisals are required, they must be prepared totally independently of each other.
On March 3, 2009 the Canadian Cultural Property Export Review Board issued revised appraisal format guidelines. All appraisals must follow and conform to these guidelines, meeting specific criteria issued in a report published by the Review Board. The Board will deny appraisals that do not meet its standard.
Donations of certified cultural property may claim the full 100% of the appraised fair market value, and will not be subject to paying capital gains taxes on any appreciated values. However, donors will be subject to the recapture of capital property depreciation losses.
For the Canadian Cultural Property Export Review Board, the appraiser must be a well-recognized professional, qualified to certify their appraisals. For the Canadian Cultural Property Export Review Board a qualified appraiser is an individual with verifiable education and experience in valuing the relevant type of property for which the appraisal is performed.
My appraisals conform to, and are qualified according to the Appraisal Foundation's Uniform Standards of Professional Appraisal Practice. Addressing at least twelve specific points, my appraisals provide the best evidence for value conclusions and dispute resolutions. My appraisal, on an artwork that meets the criteria of cultural property, will satisfy all the requirements and conditions of the hard to convince Canadian Cultural Property Export Review Board.
Each Appraisal For Charitable Donation or Cultural Property Contains
A full description of the artwork including a "thumbnail" narrative description.
A digital colour photograph of the artwork.
A detailed, signed and dated condition report describing the artwork.
A careful examination of prices realized for similar artworks.
An examination of the art market(s) in which similar artworks are sold.
An accurate and timely value of the artwork.
A description of the process used to value the artwork and a definition of the value sought in the appraisal.
A signed and dated certification that my appraisal conforms to uniform academic and ethical standards.
The seal of the International Society of Appraisers recognizing that I am an Accredited Member with a specialty in fine art.
Reasons for Appraisals
