Certified valuation appraisals for transfers, gifts and estate tax planning purposes

What is a certified valuation appraisal for tax planning purposes?

A certified valuation appraisal establishes the fair market value (FMV) of assets transferred through wealth transfer vehicles or gifts and are required for tax reporting purposes. Governed generally by IRS Revenue Ruling 59-60, and more specifically depending on the type of transfer: Internal Revenue Code (IRC) Sections 2031 (Estate Tax) and IRC 2512 (Gift Tax), these valuations ensure accurate planning, reporting and compliance with IRS rules. Assets commonly requiring valuation include privately held business interests, trusts or other wealth transfer vehicles which often hold a variety of valuable assets.

Accurate valuations assist and protect donors, heirs, and fiduciaries from, preserving their lifetime gift threshold, overpaying taxes or triggering IRS penalties, while providing a defensible basis for tax reporting. In simple terms, a certified valuation appraisal ensures that the IRS and other regulatory bodies are presented with a fair, documented, and supportable valuation of transferred, gifted or inherited assets.

VALUATION DISCOUNT AND TAX SAVINGS ESTIMATION TOOL





















See How Much Tax Savings a Formal Valuation Could Unlock for You:

Use the calculator on this page to generate an estimate of benefits that could be supported by a certified valuation appraisal customized for your specific situation. Complete the form with details about ownership, management structure, asset composition, and your remaining lifetime gift tax exemption.

Once submitted, our system will process your inputs and produce a summary of a Draft Valuation Report, which will then be delivered by one of our professionals.

The figures, estimates, and projections contained within the Draft Valuation Report have not been independently examined, reviewed, audited, or verified for accuracy or completeness. All outputs are solely for illustrative and discussion purposes only and shall not be relied upon as official financial, tax, legal, or valuation advice.

  • Identify the scope of the valuation work required and what valuation date will be needed.

  • Appraisers review financial statements, ownership structures, marketable and nonmarketable holdings, and other relevant documentation to understand the nature and characteristics of the assets being valued.

  • Market comparables, recent transactions, and economic trends are evaluated to contextualize the asset value within prevailing conditions.

  • Depending on the asset type and available data, common approaches include:

    • Market Approach: Compares the asset to similar publicly traded or recently sold assets.

    • Income Approach: Projects future cash flows or income potential, discounted to present value.

    • Asset-Based Approach: Values underlying tangible and intangible assets, typically for real estate, businesses, or unique property.

  • Adjustments for factors like lack of marketability, minority interest, or control premiums are applied where appropriate to reflect realistic transfer value.

  • The final valuation is summarized in formal and detailed report, including all assumptions, methodologies, and supporting calculations, ensuring IRS defensibility and audit readiness.

How a certified valuation appraisal for tax planning purposes is obtained.

“We typically can support discounts ranging from 20% to 45% for transferred assets resulting in benefits realized through tax savings and the preservation of lifetime transfer exemptions. ”

Risks of Not Obtaining a Current Certified Valuation Appraisal

Failing to maintain a current and formal valuation can result in a variety of negative consequences:

  • IRS Consequences: Improper valuations can trigger additional taxes, interest, and fines.

  • Compromised Estate Planning: Incorrect valuations can undermine transfer strategies or wealth transfer planning resulting in inefficient use of the lifetime transfer exemption.

  • Audit and Legal Exposure: Poorly documented appraisals are more likely to be challenged by the IRS or other regulatory authorities leading to additional taxes, interest, and fines.

  • Disputes: Without a formal appraisal, disputes among transferors and transferees are likely to arise.

  • Loss or Damage of Assets: The lack of a well-documented formal appraisal could result in unintended consequences with regard to wealth management and tax planning.

Maintaining an up to date, a certified valuation appraisal ensures compliance, strategic credibility, and confidence among beneficiaries and fiduciaries.

IMPORTANT DISCLOSURE AND DISCLAIMER

The tax calculations, projections, estimates, or results generated by Alpha Analytics, LLC’s tools, models, spreadsheets, software, or any related outputs (collectively, the “Tools”) are provided for illustrative, informational, and planning purposes only. These outputs are estimates based on user-provided inputs, publicly available tax data, simplified assumptions, and current interpretations of applicable federal, state, and local tax laws as of the date of calculation. They are not intended to constitute, and should not be construed as, tax advice, legal advice, accounting advice, or a substitute for professional consultation.

Tax laws are complex, subject to frequent change, and highly dependent on individual circumstances, including but not limited to income sources, deductions, credits, filing status, residency, business structure, transaction timing, valuation methodologies, and jurisdictional rules. The Tools do not account for all possible variables, exceptions, elections, or future legislative, regulatory, or judicial changes. Actual tax liability may differ—potentially materially—from the estimates provided.

No Reliance Without Professional Review

You must not rely on the results of the Tools for filing tax returns, making irrevocable financial decisions, executing transactions, or determining final tax obligations. Any use of the Tools is at your sole risk. Alpha Analytics, LLC strongly recommends that all outputs be reviewed, validated, and customized through a comprehensive, case-specific analysis performed by qualified tax attorneys, certified public accountants, enrolled agents, or other licensed professionals retained on your behalf.

No Guarantee of Accuracy or Completeness

While Alpha Analytics, LLC strives to maintain accurate and up-to-date information within the Tools, we do not warrant or guarantee the accuracy, completeness, timeliness, or suitability of any output. Errors in input data, model assumptions, or software functionality may produce incorrect results. We disclaim any responsibility for decisions made based on Tool outputs.

Limitation of Liability

To the fullest extent permitted by law, Alpha Analytics, LLC, its affiliates, officers, employees, and agents shall not be liable for any direct, indirect, incidental, consequential, special, or punitive damages arising from the use of the Tools—including but not limited to tax penalties, interest, lost opportunities, or adverse financial outcomes—even if advised of the possibility of such damages.

By using the Tools, you acknowledge that you have read, understood, and agree to this disclosure. Professional guidance is essential to ensure compliance and optimize your tax position.