Who Needs a Certified Machinery and Equipment Appraisal? Part 1
We have discussed in numerous posts reasons why you should always rely on a certified machinery and equipment appraiser (CMEA). To reduce your risk of liability, you should be sure that the appraisal is conducted by a certified professional. CMEAs meet all government training requirements, and will provide appraisal reports that are USPAP compliant and will stand up to scrutiny in a court of law. Below are two groups of business professionals that should always rely on CMEAs when it becomes necessary to know the value of any machinery and equipment.
Accountants and CMEAs
Quality accountants should act in the best interest their clients, and the best thing they can do is to make sure that they are compliant with laws and best practices when dealing with the IRS. If an accountant does not rely on a certified machinery and equipment appraisal to determine the value of a piece of equipment, he or she is putting clients at a significant risk. Oftentimes, the IRS will not accept the value of a piece of equipment that is not substantiated.
Here are situations in which accountants should always secure a certified machinery or equipment appraisal to avoid penalties and help eliminate risk of liability for their clients:
- Converting from C Corp to S Corp
- 1031 Exchanges
- Gifting
- Sarbanes-Oxley Compliance
- Determining Property Taxes
Attorneys and CMEAs
For attorneys who work on cases that involve the value of a business’s physical assets, like machinery and equipment, it is risky to rely on the outdated client estimates, depreciation schedules, or guess at value rather than rely on a certified machinery and equipment appraisal. Attorneys need to make sure that appraisals will hold up to scrutiny with the IRS, courts, or lenders. This is also important in the following situations:
- Loans / Leases • Property Taxes • Insurable Value
- Divorce • Converting from C to S Corp • Cost Segregations
- Taxes • 1031 Exchanges • Trust Agreements
- Buy / Sell Agreements • Estate Planning • Bankruptcy
- Retirement Planning • Partnership Dissolution • Strategic Planning
- Litigation Support • GASB 34 • Sarbanes-Oxley
- Collateral • Gifting
Present Value LLC is a nationwide appraisal and advisory company that provides a range of professional services such as Certified Machinery and Equipment Appraisals, Inventory Appraisals, Asset Verification Services, Business Valuations, and Real Estate Appraisals. Contact us today!
By: Present Value
Additional Reading:
Three Things to Think About When Engaging a Machinery and Equipment Appraiser
The 7-Step Scope of Work for a Typical Machinery and Equipment Appraisal