The Green Mission Inc and Probity Appraisal Group opened our doors in September 2019. Since then, we have become industry leaders in appraisal production—substantiating non-cash charitable contributions for federal and state tax deductions.
The Green Mission Inc prepares appraisals for deconstruction and architectural reuse property. Probity Appraisal Group covers donations of fine and decorative art, furnishings, antiques, collectibles, and other personal property.
Prior to our opening, there were only a handful of deconstruction appraisers nationwide. Industry members speculate that 1-4 appraisers were completing 75% of all deconstruction appraisals.
Qualifications and educational experience are difficult to determine; with longevity in the market seeming to be the most touted qualification. Additionally, online presence is spotty without inclusion of sample appraisals, articles, or other information demonstrating an appraiser’s competency. Most lack accreditation from one of the three organizations listed below and/or have been involved in important US Tax Court cases, where the taxpayer lost their deduction due to the underlying appraisal and Form 8283.
Per all appraisal organizations, sample appraisals are our best advertising tool and should always be available for review. Additionally, we proactively have clients opt in or out in sharing their completed appraisal with the nonprofit, to ensure USPAP (Uniform Standards of Professional Appraisal Practice) confidentiality requirements. This provides additional daylight throughout the process.
Our CEO, Jessica I. Marschall, CPA, completed complete education requirements for all three of the personal property appraisal organizations sponsoring The Appraisal Foundation:
American Society of Appraisers (ASA)
Appraisers Association of America (AAA)
International Society of Appraisers (ISA)
She is accredited as an ISA AM and completed the extensive graduate-level course work of the AAA CASP program as well as all ASA core courses. She will continue towards accreditation and participates in extensive continuing education including monthly chapter meetings, annual conferences, and presentations by IRS Counsel on relevant appraisal and appraiser related issues. Jessica is also a CPA of 21 years and owns a separate tax consultation practice
Mayur Dankhara, LEED AP, has a MS in Construction Management and has been working within the construction and deconstruction appraisal field for a decade. His knowledge of construction components allows him to prepare appraisal quotes and valuations based upon his knowledge of construction elements and calculation of individual components removed during deconstruction.
For each appraisal, Mayur first completes a detailed inventory of potential materials and property that will be removed and donated from a structure. This is then cross-checked by both the deconstruction contractor, nonprofit, and client to ensure they will be donating everything on the initial list and if they see any changes needed. This step also allows Mayur to determine if there is a margin of error in harvesting materials requiring the estimated value range to be expanded or contracted.
Mayur then remits an appraisal quoted value range to the client within 24-48 hours of receiving the information. This range is based solely upon examination of closed sales and firm offers of sale of similar materials in the open and relevant market, which is the secondary retail and auction market. The estimate is not based upon square footage calculations or using construction estimating software such as R.S. Means or Marshall & Swift.
Our appraisals are written no differently than an appraisal for a piece of fine art or antique furnishings. The same appraisal standards apply to donations of building materials and must be followed to the letter—per appraisal organizations and the IRS.
Here is an example of how an appraised piece should be presented. Along with this information, we provide an addendum with documentation substantiating every comparable sale researched:
Presentation:
In review engagements where we are often contracted to correct disqualified appraisals, the presentation of a piece of property is as follows:
As referenced earlier, there have been two US Tax Court cases where taxpayers have lost their deductions due to disallowance based upon the appraisal and incorrect completion of Form 8283. In both cases, the underlying public records show the appraisal did not use the correct methodology, the Sales Comparison or Market-Based approach and, instead, plugged valuations into new construction cost estimating software, R.S. Means, and spit out a number not tethered to verifiable market sales and activity. These cases have significantly damaged the donation and reuse market as taxpayers and their CPAs have significant reservations about the process.
The IRS has been clear, in numerous presentations, that they are not trying to disallow non-cash charitable donations. However, they hold out these cases, Mann v. US and lost appeal and Loube V. Commissioner as examples of what not to do.
Please see the articles below for additional information on these critical Tax Court cases.
https://www.thegreenmissioninc.com/article/irs-qualified-appraisers-and-appraisals-matter
The take-away? Take a look at the numbers, which tell the story of why an appraiser might use this short-cut approach and avoid the time-consuming process of researching comparable sales and capturing the data accurately.
The Green Mission Inc. and Probity Appraisal Group will continue pushing forward with our research and applied methodology to ensure taxpayers are protected by a well-researched IRS compliant appraisal. Consequently, we will continue our mission to divert material and properties away from the landfill and towards reuse.
Reach out to our team to begin the job quoting process and see the difference.
