When estates include a large amount of installed machinery, it's
important to determine when it's appropriate to include shipping,
installation and permitting costs in the related appraisal, keeping in
mind that these associated costs often provide more than half of the
value for installed machinery.
Example: Valuation with a Business Valuation appraiser on an estate including a recently upgraded factory. In this scenario, the appraisal is generally for Fair Market Value in Continued Use, which assumes that the earnings support the values. In this case, however, the upgrade included a significant design flaw - resulting in an annual net operating loss - so that the earnings of the factory did not support the values. Instead of using the typical definition of value, the equipment appraiser provided research and the proper documentation to rationalize and support the appropriate definition of value.
These two examples are certainly just a small sample of the specific estate valuation issues that equipment appraisers routinely experience.Two prevalent concerns these days include the economic obsolescence factors of CARB diesel emissions regulations and the financially influenced dilemma of under-utilized processing facilities. And of course, there are many other issues involved in equipment appraisals for estates that are not directly linked to current conditions.
Surprising enough, then, it turns out that an equipment and machinery appraiser - while perhaps not as regularly involved in estate planning as some lawyers and economical planners - can be actively involved in estate planning. And we can often contribute a unique perspective to the estate planning community.
*The exact dollar amount that describes a taxable estate can vary from year to year. Be sure to contact your tax expert for up-to-date regulations.
Jack Young, ASA, CPA, is an Approved Senior Appraiser (ASA) of the American Society of Appraisers specializing in machinery and products and owner of NorCal Valuation in Northern California. Jack is active in the Northern California/Nevada Chapter of the ASA and currently serves as Vice-president of the chapter.
equipment appraisal equipment appraisers heavy equipment appraisal heavy equipment appraisal, used equipment value, tractor values, equipment appraisals, heavy equipment appraisers, machinery and equipment visit at: http://www. equipappraisers.com
Example: Valuation with a Business Valuation appraiser on an estate including a recently upgraded factory. In this scenario, the appraisal is generally for Fair Market Value in Continued Use, which assumes that the earnings support the values. In this case, however, the upgrade included a significant design flaw - resulting in an annual net operating loss - so that the earnings of the factory did not support the values. Instead of using the typical definition of value, the equipment appraiser provided research and the proper documentation to rationalize and support the appropriate definition of value.
These two examples are certainly just a small sample of the specific estate valuation issues that equipment appraisers routinely experience.Two prevalent concerns these days include the economic obsolescence factors of CARB diesel emissions regulations and the financially influenced dilemma of under-utilized processing facilities. And of course, there are many other issues involved in equipment appraisals for estates that are not directly linked to current conditions.
Surprising enough, then, it turns out that an equipment and machinery appraiser - while perhaps not as regularly involved in estate planning as some lawyers and economical planners - can be actively involved in estate planning. And we can often contribute a unique perspective to the estate planning community.
*The exact dollar amount that describes a taxable estate can vary from year to year. Be sure to contact your tax expert for up-to-date regulations.
Jack Young, ASA, CPA, is an Approved Senior Appraiser (ASA) of the American Society of Appraisers specializing in machinery and products and owner of NorCal Valuation in Northern California. Jack is active in the Northern California/Nevada Chapter of the ASA and currently serves as Vice-president of the chapter.
equipment appraisal equipment appraisers heavy equipment appraisal heavy equipment appraisal, used equipment value, tractor values, equipment appraisals, heavy equipment appraisers, machinery and equipment visit at: http://www. equipappraisers.com
Fair Market Value is an opinion expressed in terms of money, at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts, as of a specific date.