Robert A. Ensminger

Personal Property Appraiser

UniformStandards of ProfessionalAppraisalPractice (USPAP) Compliant Appraisal Reports

In the past 30 years I have conducted more than 1,000 personal property appraisals. Generally, anything that is not considered real estate is considered to be personal property. Personal property is further divided into tangible and intangible property. These items are then usually classified as business property or personal use property. Some definitions are posted below, but first let’s look at some of the reasons personal property appraisals are needed.

• Estates. This is the most common reason for personal property appraisals. Upon the death of an individual, most states, and in some cases, the federal government, require inheritance tax to be paid on value the deceased’s estate.
• Divorce. The function of the appraisal is usually to divide property in an equitable manner. An appraisal may be needed when there is a wide variation in values claimed by either party.
• Bankruptcy. Appraisals are used by attorneys and the courts to determine the value of assets of an individual or corporation.
• Insurance. Insurance companies require appraisals for high value items (jewelry, coins, antiques, works of art, etc.) in order to provide proper insurance coverage.
• Business loans. Banks usually require appraisals for business loans involving fixtures, machinery & equipment.
• Charitable contributions. The IRS requires appraisals of personal property valued in excess of $500 if the donor is to deduct the value of the gift from his taxes.
• Partnership formation and dissolution.

These are some, but not all the reasons personal property appraisals are performed. Now let’s look at the different classes of personal property.

1. Intangible personal property includes financial instruments such as stocks & bonds, copyrights, trademarks, patents, and business goodwill.
2. Tangible personal property generally includes things you can see and touch – from diamond dust aircraft carriers.

There are several different types of value that can be reported for personal property. There are entire papers and dissertations relating to the various values, but several are encapsulated here.

• Liquidation value – the value of an asset that can be converted to cash on relatively short notice and sometimes referred to as auction value. Our years of experience in the auction industry is the basis for these values.
• Value in use – sometimes used in business appraisals where operations are expected to continue. Also in divorce appraisals where one party retains possession of the personal items.
• Retail value – replacement cost commonly available in retail outlets.
• Insurable value – may be full retail value and include shipping and setup costs for a replacement cost policy, but may also only be the depreciated value of the asset, vehicles and machinery being excellent examples.

What do we appraise?

· Real Estate (please see the Real Estate section of our web site.)

· Private estates, including divorce and bankruptcy appraisals – we have general knowledge of most items found in a typical estate – household furnishings, jewelry, coins, collectibles, tools, antiques, firearms, clocks, vehicles and most items imaginable. Our auction experience is the basis for our appraisals and backed up by a ton of reference books and the resources of the internet.

· Commercial appraisals – again from our auction experience, we can value the physical assets of many business concerns including furniture, fixtures and equipment (FF&E), including computers, telephone equipment, warehouse stock, rolling stock, tools, general machinery and equipment found in many small and medium size business concerns.

What do we not appraise?

· We do not engage in appraisals for insurance valuations.

· We do not perform damage assessment appraisals.

· We do not engage in retail appraisals.

· We do not appraise fine art and high-end antiques.

· We do not conduct industrial appraisals consisting of large and specialized machinery and large construction equipment.

Some definitions:

Personal property: an estate or property consisting of movable articles both corporeal, as furniture or jewelry, or incorporeal, as stocks or bonds (distinguished from real porperty).

Real property: an estate or property consisting of lands and of all appurtenances to lands, as buildings, crops, mineral or air rights (distinguished from personal property).

Tangible asset: having actual physical existence, as real estate or chattels, and therefore capable of being assigned a value in monetary terms.

Intangible asset: incapable of being perceived by the sense of touch, as incorporeal or immaterial things… existing only in connection with something else, as the goodwill of a business.

Estate: The whole of one's possessions, especially all the property and debts left by one at death.

Bankrupt: a person who upon his or her own petition or that of his or her creditors is adjudged insolvent by a court and whose property is administered for and divided among his or her creditors under a bankruptcy law.

Chattel: any article of tangible property other than land, buildings, and other things annexed to land.