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.
| 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.
Estate valuations directly affect:
Federal or state estate taxes
Capital gains taxes when heirs sell the property
Probate proceedings and court filings
Trust distributions and settlement between heirs
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.
Under IRS guidelines, a Qualified Appraiser must:
Hold a valid state certification or license
Have experience valuing the specific type of property
Be independent with no interest in the property
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.
Even a small valuation error can lead to significant tax consequences. Using a CMA instead of a qualified appraisal may result in:
Incorrect estate tax reporting
Higher capital gains taxes for heirs
IRS penalties or audits
Legal disputes between beneficiaries
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.
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.
If you are an executor, attorney, accountant, or heir needing a defensible valuation, we provide:
IRS-qualified real estate appraisals
👉 Contact us today to schedule an estate appraisal.