When a family member passes away, part of settling the estate includes determining the market value of their real property. This process is commonly called a Date of Death valuation or estate appraisal.
While some families consider asking a real estate agent for a CMA (Comparable Market Analysis), doing so can lead to delays, disputes, or costly tax problems. A CMA is not an IRS-recognized valuation for estates. Only a qualified real estate appraiser can provide the legally defensible value needed for tax and legal purposes.
✔ Appraisal vs. CMA: What’s the Difference?
| IRS-Qualified Appraisal | CMA (Comparable Market Analysis) |
|---|---|
| Performed by a state-licensed or certified appraiser | Prepared by a real estate agent |
| Must comply with IRS rules and USPAP | No federal valuation standards |
| Uses verified, measured, and analyzed market data | Often based on MLS data estimates |
| Accepted by courts, IRS, attorneys, and accountants | Not accepted by the IRS for complex assets |
| Designed for legal, tax, and estate purposes | Designed for selling a home |
A CMA is useful when deciding on a listing price. For an estate, however, it does not meet the IRS standard and is not defensible if challenged.
🏛 Why the IRS Requires a Qualified Appraisal
Estate valuations directly affect:
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Federal or state estate taxes
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Capital gains taxes when heirs sell the property
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Probate proceedings and court filings
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Trust distributions and settlement between heirs
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Basis calculations for tax planning
If the value is incorrect, the estate could face an audit, tax penalties, or disputes among beneficiaries.
A qualified appraiser provides documentation and evidence designed to stand up to legal and IRS scrutiny.
📝 What Is a “Qualified Appraiser”?
Under IRS guidelines, a Qualified Appraiser must:
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Hold a valid state certification or license
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Have experience valuing the specific type of property
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Be independent with no interest in the property
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Comply with USPAP (Uniform Standards of Professional Appraisal Practice)
Without these requirements, a valuation does not meet IRS standards and could be rejected if audited.
💸 How Using a CMA Can Cost the Estate Money
Even a small valuation error can lead to significant tax consequences. Using a CMA instead of a qualified appraisal may result in:
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Incorrect estate tax reporting
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Higher capital gains taxes for heirs
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IRS penalties or audits
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Legal disputes between beneficiaries
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Delays in probate and asset distribution
It’s common for CMAs to differ from IRS-qualified appraisals by 10–25% or more—often costing families thousands of dollars in taxes.
🛡 Protect the Estate. Protect the Heirs. Use a Qualified Appraisal.
A Date of Death appraisal provides more than a number—it provides legal protection, tax accuracy, and peace of mind. For estates, trusts, probate, and tax planning, a CMA simply isn’t enough.
📌 If legal or tax implications depend on the value, you need an IRS-qualified appraisal.
📞 Need a Date of Death Appraisal?
If you are an executor, attorney, accountant, or heir needing a defensible valuation, we provide:
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IRS-qualified real estate appraisals
- Rush appointments are available when deadlines apply!
👉 Contact us today to schedule an estate appraisal.
