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Qualified Appraisals and Qualified Appraisers: Expert Tax Valuation Witness Reports, Testimony, Procedure, Law, and Perspective [Kõva köide]

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  • Formaat: Hardback, 256 pages, kõrgus x laius x paksus: 254x183x25 mm, kaal: 612 g
  • Sari: Wiley Finance
  • Ilmumisaeg: 09-Feb-2018
  • Kirjastus: John Wiley & Sons Inc
  • ISBN-10: 1119437571
  • ISBN-13: 9781119437574
Teised raamatud teemal:
Qualified Appraisals and Qualified Appraisers: Expert Tax Valuation Witness Reports, Testimony, Procedure, Law, and PerspectiveSuurem pilt
  • Formaat: Hardback, 256 pages, kõrgus x laius x paksus: 254x183x25 mm, kaal: 612 g
  • Sari: Wiley Finance
  • Ilmumisaeg: 09-Feb-2018
  • Kirjastus: John Wiley & Sons Inc
  • ISBN-10: 1119437571
  • ISBN-13: 9781119437574
Teised raamatud teemal:
Püsilink: https://www.kriso.ee/db/9781119437574.html
Märksõnad:
"There has been a steady flow of controversies since the IRS issued its regulations on qualified appraisers and qualified appraisals. The IRS has developed a body of law relating to the qualifications needed to satisfy the Government that an appraisal isadequate to support the taxable event on the taxpayer's return. This book discusses elements related to testifying experts and introduces a novel form of expert testimony: hot tubbing. The book identifies the law, analyzes the cases, identifies the problems and provides insight and solutions to help appraisers do work which will be accepted by the IRS"--

Decode IRS appraisal regulations and find practical solutions to current issues

Qualified Appraisers and Qualified Appraisals provides clarification on complex IRS guidelines, and offers solutions and insight that can help appraisers adhere to the latest Treasury Regulations concerning appraisals submitted in tax matters. From the Uniform Standards of Professional Appraisal Practice to IRS regulations, this book explores the body of law that has arisen around the production of “qualified appraisals” that the government and courts will accept. The discussion covers estate, gift, charitable contribution, income taxes, and more, with expert guidance on the interpretation and application of complex regulations. As appraisers often are called upon to provide expert testimony in court, this book shares effective methods including the novel “hot-tubbing” technique that eliminates the appearance of bias in favor of a less-adversarial discussion. Cases are dissected as they relate to application of existing appraisal laws, and the companion website features checklists, references, and additional cases as they become available.

The IRS regulations on qualified appraisers and qualified appraisals have sparked a storm of controversy, and have raised more questions than they have answered. This book acknowledges the problems and offers solutions to help appraisers produce work the IRS and courts will accept.

  • Understand the laws surrounding “qualified appraisals” and “qualified appraisers”
  • Gain insight on testifying as an expert, including new techniques
  • Explore solutions to common issues the IRS raises with respect to qualified appraisals and qualified appraisers
  • Examine cases that illustrate the nuances of appraisal law application

In order for an appraisal to satisfy the government, an appraisal must be performed by a “qualified appraiser” specific for the type of property in question. This broad statement leaves much to question, but Qualified Appraisers and Qualified Appraisals provides the answers appraisers need to comply with the law and produce work that meets the latest standards.

Foreword xvii
Shannon R. Pratt
Foreword xix
Jay E. Fishman
Preface xxi
Chapter 1 Tax Valuation and the Necessity for Expert Appraisals 1(11)
Summary
1(1)
The Need for Valuation Experts
1(3)
Valuation in Tax Reporting
2(1)
Valuation in Tax Litigation
3(1)
Valuation in Business and Familial Matters
4(1)
Valuation Calculation Standards
4(3)
Fair Market Value Defined
5(1)
Implied Assumptions
6(1)
Cash Value and Market Value
7(1)
Computing Fair Market Value
7(2)
Step 1: Calculating Net Asset Value
8(1)
Step 2: Applying Discounts and Premiums
9(1)
Common Tax Appraisal Reports
9(1)
Appraisal Reports to Support Tax Reporting Positions
9(1)
Appraisal Reports to Support Tax Litigation
10(1)
Proliferation of Litigation
10(1)
Conclusion
11(1)
Chapter 2 Qualified Appraisal 12(19)
Summary
12(1)
Defining Qualified Appraisal
12(1)
Situations in Which a Qualified Appraisal May Be Required
13(1)
Qualified Appraisal Requirements for Charitable Contribution Deductions Context
14(15)
Requirements
15(1)
Legislative History
16(2)
Statutory Definition of a Qualified Appraisal
18(1)
Regulatory Definition of a Qualified Appraisal
18(9)
Requirement 1: The 60-Day Requirement: Treas. Reg. § 1.170A-13(c)(3)(i)(A)
19(1)
Requirement 2: The Qualified Appraiser Requirement: Treas. Reg. § 1.170A-13(c)(3)(i)(B)
19(1)
Requirement 3: The Substantive Requirements: Treas. Reg. § 1.170A-13(c)(3)(i)(C)
20(7)
Requirement 3.1: Property Description: Treas. Reg. § 1.170A-13(c)(3)(ii)(A)
20(1)
Requirement 3.2: Tangible Property: Treas. Reg. § 1.170A-13(c)(3)(ii)(B)
21(1)
Requirement 3.3: Date of Contribution: Treas. Reg. § 1.170A-13(c)(3)(ii)(C)
21(1)
Requirement 3.4: Terms of Agreement: Treas. Reg. § 1.170A-13(c)(3)(ii)(D)
22(1)
Requirement 3.5: Identifying Information of the Qualified Appraiser: Treas. Reg. § 1.170A-13(c)(3)(ii)(E)
23(1)
Requirement 3.6: The Qualifications of the Qualified Appraiser: Treas. Reg. § 1.170A-13(c)(3)(ii)(F)
24(1)
Requirement 3.7: Statement of Preparation for Income Tax Purposes: Treas. Reg. § 1.170A-13(c)(3)(ii)(G)
24(1)
Requirement 3.8: Date(s) of Appraisal: Treas. Reg. § 1.170A-13(c)(3)(ii)(H)
25(1)
Requirement 3.9: Appraised Fair Market Value: Treas. Reg. § 1.170A-13(c)(3)(ii)(I)
25(1)
Requirements 3.10 and 3.11: Valuation and Basis Used to Determine Fair Market Value: Treas. Reg. §§ 1.170A-13(c)(3)(ii)(J) and (K)
26(1)
Requirement 4: No Prohibited Fee Arrangement: Treas. Reg. § 1.170A-13(c)(3)(i)(D)
27(1)
The Qualified Appraisal Requirement and Pass-Through Entities
27(1)
Interplay of the Qualified Appraisal and Appraisal Summary Requirements
28(1)
Litigation Concerning Qualified Appraisals
29(1)
Conclusion
29(2)
Chapter 3 Qualified Appraiser 31(12)
Summary
31(1)
Legislative History
31(1)
Statutory Requirements
32(3)
Statutory Requirement #1: Appraisal Designation or Certain Minimum Education and Experience Requirements
33(1)
Statutory Requirement #2: Regularly Performs Appraisals for Compensation
34(1)
Statutory Requirement #3: Verifiable Education and Experience
34(1)
Statutory Requirement #4: Not Prohibited from Practice by 31 U.S.C. § 330(c)
34(1)
Regulatory Requirements
35(6)
Appraiser's Declaration
35(3)
Regulatory Requirement #1: Declaration That Individual Is an Appraiser: Treas. Reg. § 1.170A-13(c)(5)(i)(A)
36(1)
Regulatory Requirement #2: Declaration That the Appraiser Is Qualified to Value the Property: Treas. Reg. § 1.170A-13(c)(5)(i)(B)
36(1)
Regulatory Requirement #3: Declaration That the Appraiser Is Not an Excluded Person: Treas. Reg. § 1.170A-13(c)(5)(i)(C)
36(2)
Regulatory Requirement #4: Declaration That the Appraiser Understands Consequences of Fraudulent Valuation: Treas. Reg. § 1.170A-13(c)(5)(i)(D)
38(1)
Additional Declaration Requirements of Notice 2006-96
38(1)
Denial of Appraiser Status
39(1)
Appraisals by More than One Appraiser
40(1)
Appraisal Fees
40(1)
Judicial Interpretation of the Requirements
41(1)
Sufficiency of Documentation
41(1)
Scrutiny of Qualifications
42(1)
Excluded Parties
42(1)
Multiple Appraisers
42(1)
Conclusion
42(1)
Chapter 4 Substantial Compliance vs. Strict Compliance 43(15)
Summary
43(1)
Overview of the Strict and Substantial Compliance Doctrines
43(1)
Applicability of the Substantial Compliance Doctrine
44(1)
Judicial Approaches to the Substantial Compliance Doctrine
45(1)
Survey of Cases Applying the Substantial Compliance Doctrine
45(8)
Bond v. Commissioner: The First Application of the Substantial Compliance Doctrine in the Context of the Qualified Appraisal Regulation
46(1)
Post-Bond Decisions: Cases Finding Substantial Compliance
47(2)
Supplemental Information from Form 8283
47(1)
Sufficient Information for IRS to Evaluate Reported Contributions as Intended by Congress
48(1)
A New Trend?
48(1)
Post-Bond Decisions: Cases Finding No Substantial Compliance
49(11)
Absence of Qualified Appraisal
49(1)
Flawed Appraisal Reports
50(3)
Post-Scheidelman Cases
53(1)
Judicial Approaches to the Strict Compliance Doctrine
53(1)
The Substantial Compliance Doctrine in the Appellate Courts
54(1)
Reasonable Cause: Codification of the Substantial Compliance Doctrine
55(1)
Conclusion
56(2)
Chapter 5 Government Expert Witnesses 58(10)
Summary
58(1)
The Government's Need for Expert Testimony
58(1)
IRS Criteria for Expert Selection
59(1)
Internal IRS Valuation Experts
60(4)
IRS Hiring, Training, and Evaluation of Internal Valuation Experts
62(1)
Hiring
62(1)
Training
62(1)
Performance Evaluation and Management Oversight
63(1)
IRS Use of Internal Valuation Expert Witnesses
63(5)
Advantages to Using an Internal Valuation Expert as an Expert Witness
63(1)
The Inherent Bias Problem
63(1)
Court Reactions to Government Employee Expert Witnesses
64(2)
Government's Decision to Not Present an Expert Witness
66(1)
Conclusion
67(1)
Chapter 6 The Practicalities of Selection and Preparation of Experts 68(8)
Summary
68(1)
Selecting an Appraiser
68(6)
Education, Training, Professional Experience, and Accrediting Organization Participation
69(2)
The American Society of Appraisers
69(1)
The Appraisal Institute
70(1)
The Institute of Business Appraisers
70(1)
The National Association of Valuers and Analysts
71(1)
The American Institute of Certified Public Accountants
71(1)
Being a Good Communicator
71(1)
Offering a Neutral, Detached Opinion of Value
71(1)
Avoiding the Bias Perception
71(1)
Selecting the Expert Who Prepared the Appraisal That Supports the Tax Reporting Position
72(1)
Early and Significant Appraiser Involvement
72(1)
Appraiser Scheduling and Availability
73(1)
Correcting Errors in the Expert's Report
73(1)
"Skeletons in the Closet"
73(1)
Acquainting the Expert with the Cast of Characters and Venue
73(1)
Attorney Comprehension of Expert Opinions
74(1)
Planning the Testimony
74(1)
Expert Testimony Preparation
74(1)
Conclusion
75(1)
Chapter 7 From Daubert to Bolter 76(23)
Summary
76(1)
Standard of Admissibility for Expert Witness Testimony-The Federal Rules of Evidence
76(1)
Daubert and Its Progeny in Courts Other than the Tax Court
77(4)
Boltar as the Modern Incarnation of Daubert in the Tax Court
81(1)
Daubert Challenges Generally
82(16)
Illustrations of Daubert Factors in Practice
83(17)
Factor 1: Has the theory or technique been tested?
83(1)
Factor 2: Has the theory or technique been subjected to peer review and publication?
84(2)
Factor 3: Is there a known or potential rate of error or standards for the theory or technique applied?
86(2)
Factor 4: Has the theory or technique gained general acceptance?
88(2)
Factor 5: Is the expert testifying about matters growing naturally and directly out of research conducted independent of the litigation?
90(3)
Factor 6: Has the expert unjustifiably extrapolated from an accepted premise to an unfounded conclusion?
93(2)
Factor 7: Has the expert adequately accounted for obvious alternative explanations?
95(1)
Factor 8: Is the expert being as careful as he would be in his regular professional work?
96(1)
Factor 9: Is the field or expertise claimed by the expert known to reach reliable results for the type of opinion the expert would give?
97(1)
Factor 10: Has the theory or method offered by the expert been put to any non-judicial use?
97(1)
Factor 11: Whether the expert's opinion fails to square with a judge's opinion and common sense
97(1)
Conclusion
98(1)
Chapter 8 Discovery of Expert Material 99(21)
Summary
99(1)
Overview of Discovery
99(1)
Important Limitations on Discovery
100(2)
The Attorney-Client Privilege
100(1)
Work Product
101(1)
Unfairness Doctrine
102(1)
The IRS's Summons Authority
102(1)
Procedures with Respect to Expert Witnesses Prepared in Connection with Litigation
103(1)
Discovery in the Courts
103(16)
Tax Court
104(9)
General Provisions Regarding Discovery
105(2)
Interrogatories
107(1)
Production of Documents
108(2)
Depositions
110(2)
Admissions
112(1)
U.S. District Courts
113(6)
General Provisions Regarding Discovery
113(4)
Interrogatories
117(1)
Production of Documents, Electronically Stored Information, and Other Similar Items
117(1)
Depositions
118(1)
Admissions
119(1)
Court of Claims
119(1)
Expert Should Be Present at Opposing Expert's Deposition
119(1)
Conclusion
119(1)
Chapter 9 Expert Appraisal Reports 120(20)
Summary
120(1)
Valuation Standards
120(2)
Revenue Ruling 59-60
121(1)
USPAP Generally
122(1)
Compliance with USPAP
122(1)
Noncompliance with USPAP Does Not Render an Expert Report Unreliable
122(1)
Appraisal Reports Generally
122(1)
Fair Market Value
123(1)
Contents of the Appraisal Report
123(15)
Table of Contents
123(1)
Executive Summary or Cover Letter
123(1)
Body of Report
124(12)
Identifying the Retaining Party and Other Intended Users
124(1)
Type of Appraisal
125(1)
Standard of Value and Source
125(1)
Effective Date of the Appraisal and the Date of the Report
126(2)
Purpose of the Appraisal and Its Intended Use
128(1)
Summary of the Scope of Work
128(1)
Summary of Information Considered
129(2)
Describing the Subject Property, the Type of Asset, the Interest Valued, and Geographic Data
131(1)
How Title Is Held
132(1)
Restrictions, Hypotheticals, and Limiting Conditions
132(1)
Highest and Best Use
132(1)
Valuation of the Subject Property
132(2)
Summary of Approaches Utilized
134(1)
Reconciliation
135(1)
Consider a Regression Analysis
135(1)
Conclusion of Value
136(1)
Appraiser's Signature
136(1)
Signed Certification
136(2)
Addenda
138(1)
Work File as Support for an Appraisal Report
138(1)
Contents of Work File
138(1)
Retention Period
139(1)
Conclusion
139(1)
Chapter 10 Assessing the Quality of the Appraisal Report 140(7)
Summary
140(1)
Required Items Under the USPAP and Revenue Ruling 59-60
140(2)
Making the Report Understandable to the Audience
142(1)
Replicability
142(1)
Completeness
142(1)
Internal Consistency
142(1)
Reconciliation
143(1)
Regression Analysis
143(1)
Forecasting Future Results
144(1)
Economic and Industry Sections
144(1)
Supporting Exhibits
144(1)
Comply with Applicable Court Rules
145(1)
The Tax Court
145(1)
The District Courts
146(1)
Conclusion
146(1)
Chapter 11 Concurrent Evidence: A Novel Approach to Expert Testimony 147(23)
Summary
147(1)
A New Approach to Expert Testimony
148(1)
Our Long and Deep Distrust of Partisan Experts
148(3)
Court-Appointed Experts
151(1)
Heating Up the Tub: The Concurrent Evidence Method
152(7)
Expert Bias
155(1)
Foreign Court Experiences
155(2)
American Experience with Concurrent Experts
157(2)
Suggested Four-Stage Hot Tub Approach for Tax Court Judges
159(5)
Stage One: Pretrial Expert Meeting and Joint Report
160(1)
Stage Two: The Expert Oath
161(1)
Stage Three: The Trial Hot Tub Conversation
161(2)
Stage Four: Cross-Examination and Rebuttal
163(1)
Common Misperceptions of the Concurrent Witness Model
164(2)
Myth 1: Concurrent Testimony Replaces the Traditional Model
164(1)
Myth 2: The Consent of Both Parties Is Needed
164(1)
Myth 3: More Work Is Created for the Trier of Fact
164(1)
Myth 4: Concurrent Evidence Is Received Off the Record
165(1)
Myth 5: The Concurrent Witness Model Is an Auction
165(1)
Myth 6: The Lawyers Lose All Control in the Courtroom
165(1)
Myth 7: Hot Tubbing Is Prevalent in Tax Cases
165(1)
Practical Benefits and Claimed Drawbacks
166(3)
Conclusion
169(1)
Chapter 12 Penalties Associated with Faulty Appraisals 170(21)
Summary
170(1)
The Importance and Prevalence of Penalties in Modern-Day Appraisal Practice
170(1)
Framework for Examination
171(1)
Accuracy-Related Penalties Possibly Applicable to Client-Taxpayers
171(9)
The Substantial Valuation Misstatement Penalty
172(4)
Imposition of the Penalty
172(1)
Substantial Valuation Misstatement Penalty Applies on a Property-by-Property Basis
172(1)
Dollar Limitation for Substantial Valuation Misstatements
173(1)
Substantial Valuation Misstatements and Pass-Through Entities
173(1)
Increase in Penalty Rate for Gross Valuation Misstatements
174(1)
Defenses
174(2)
The Gross Valuation Misstatement Penalty
176(4)
Gross Valuation Misstatement Applies on a Property-by-Property Basis
177(1)
Dollar Limitation for Gross Valuation Misstatements
177(1)
Gross Valuation Misstatements and Pass-Through Entities
177(1)
Elimination of Reasonable Cause Exception
178(1)
The Applicability of the Gross Valuation Misstatements to Transactions Determined to Lack Economic Substance
178(2)
Estate or Gift Tax Valuation Understatements
180(1)
Civil Penalties Potentially Applicable to Appraisers
180(9)
The Section 6695A Accuracy-Related Penalty
180(2)
The Statute
181(1)
Statute of Limitations and Collection of Penalty
182(1)
Affirmative Defenses
182(1)
Referral for Professional Sanctions
182(1)
Paid Preparer Penalty-Section 6694
182(4)
The Statute
183(2)
Appraisers as Paid Return Preparers
185(1)
De Minimis Exception
185(1)
Affirmative Defenses
186(1)
Aiding and Abetting an Understatement of Tax-The Section 6701 Penalty
186(3)
The Statute
187(1)
Coordination with Other Penalties
188(1)
Injunctions against Appraisers
188(1)
Effect of Imposition of the Section 6701 Penalty
188(1)
Professional Sanctions
189(1)
Circular 230 Generally
189(1)
Disqualification of Appraisers under Circular 230
189(1)
Monetary Penalty
189(1)
Conclusion
190(1)
Chapter 13 Attorney Involvement 191(14)
Summary
191(1)
Framework for Examination
191(1)
Attorney Involvement in Selecting the Appraiser
192(2)
An Appraiser's Ability to Withstand a Daubert Challenge
193(1)
The Importance of Having the Attorney Engage the Appraiser
193(1)
Attorney Involvement in the Appraisal Process
194(4)
The Fact-Gathering Process
194(1)
The Report Preparation Process
195(1)
The Review Process
196(1)
Sanctions for Improper Attorney Assistance
197(1)
The Tax Preparation Process
198(1)
Coordinating the Attorney's and the Appraiser's Involvement in Negotiations with Tax Authorities
198(1)
Attorney Involvement in Litigation Where Expert Reports Will Be Submitted
199(1)
Discovery and the Expert Appraiser
200(1)
Submitting the Expert Appraisal Report to the Court
200(3)
Motions in Limine
201(1)
Rebuttal Reports
202(1)
Qualifying the Appraiser as an Expert and Satisfying Daubert
203(1)
Cross-Examination and Rehabilitation
203(1)
Cross-Examination
203(1)
Rehabilitating the Expert Witness
203(1)
Conclusion
204(1)
Chapter 14 Common Errors with Appraisal Reports and How to Avoid Them 205(14)
Summary
205(1)
Common Defects with Appraisals
205(13)
Defect 1: Untimely Appraisal Report
206(1)
Requirement and Error
206(1)
Remedy
206(1)
Defect 2: Inadequate Description of Property
207(1)
Requirement and Error
207(1)
Remedy
207(1)
Defect 3: Failing to Analyze Agreements and Restrictions with Respect to the Property
208(1)
Requirement and Error
208(1)
Remedy
208(1)
Defect 4: Qualifications Not Disclosed
209(1)
Requirement and Error
209(1)
Remedy
209(1)
Defect 5: No Statement That Appraisal Was Prepared for Federal Tax Purposes
210(1)
Requirement and Error
210(1)
Remedy
210(1)
Defect 6: Wrong Measure of Value
210(3)
Requirement and Error
210(2)
Remedy
212(1)
Defect 7: Lack of Reconciliation
213(2)
Requirement and Error
213(1)
Remedy
214(1)
Defect 8: Consideration of Subsequent Events
215(1)
Requirement and Error
215(1)
Remedy
216(1)
Defect 9: Tax-Affecting S Corporations
216(1)
Requirement and Opportunity for Error
216(1)
Remedy
217(1)
Potential Defect 10: Failure to Include a Regression Analysis
217(1)
Conclusion
218(1)
Table of Cases 219(4)
About the Authors 223(2)
Index 225
MICHAEL R. DEVITT, CPA, JD, MS, is Professor-in-Residence at the University of San Diego Law School. He was managing partner of a law firm where he practiced complex civil litigation in various jurisdictions around the U.S. and lead counsel in several high-profile cases dealing with fraudulent financial reporting, which have resulted in hundreds of millions of dollars in combined recoveries. He is a frequent lecturer on evidence, financial reporting, accounting, litigation, ethics and other topics.

LAWRENCE A. SANNICANDRO, LLM, JD, MBA, is a tax controversy and litigation attorney with McCarter & English, LLP. He regularly represents clients in audits before the IRS Office of Appeals, and in litigation before the United States Courts of Appeals, the United States Tax Court, the United States Court of Federal Claims, and United States District Courts. Prior to entering private practice, Mr. Sannicandro served as a law clerk for the United States Tax Court, and before that, as an attorney for the IRS. Mr. Sannicandro has written extensively on tax practice and procedure.