SECTION 8. APPRAISAL FOR

ESTATE TAX OR GIFT TAX PURPOSES

.01 An appraisal submitted to the Service by a taxpayer under section 7

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of this revenue procedure must include the following:

(1) a complete description of the item of art, including:

(a) the name of the artist or culture, (b) the title or subject matter, (c) the medium, such as oil on canvas, or watercolor on paper,

(d) the date created, (e) the size, (f) any marks, signatures, or labels on the item of art, on the back of the item of art, or affixed to the frame,

(g) the history (provenance) of the item, including proof of authenticity, if such information is available,

(h) a record of any exhibitions at which the item was displayed,

(i) any reference source citing the item, and

(j) the physical condition of the item; (2) a professional quality photograph of a size and quality fully showing the item, preferably an 8 x 10 inch color photograph or a color transparency not smaller than 4 x 5 inches;

(3) a statement that the appraisal was prepared for estate tax purposes or gift tax purposes;

(4) the date (or dates) on which the item of art was appraised;

(5) the appraised fair market value (within the meaning of § 20.2031–6(a) or 25.2512–1); and

(6) the specific basis for the valuation.

.02 The appraisal must be made no earlier than 60 days prior to the valuation date.

.03 Taxpayers are encouraged to include in the request any additional information that may affect the determination of the fair market value of the item of art.

.04 An appraisal must: (1) be prepared, signed, and dated by an appraiser, and contain a statement by the appraiser that:

(a) the appraiser either holds himself or herself out to the public as an appraiser or performs appraisals on a regular basis;

(b) the appraiser is qualified to make appraisals of the item of art;

(c) the appraiser is not the taxpayer; (d) the appraiser was not a party to the transaction in which the decedent or donor of the gift acquired the item of art being appraised, unless the valuation date is within 2 months of

the date of acquisition and the appraised value is not less than the acquisition price;

(e) the appraiser is not the beneficiary or donee receiving the item of art;

(f) the appraiser is not a person who was employed by the decedent or is employed by the taxpayer;

(g) the appraiser is not related to any of the foregoing persons under § 267(b) or married to a person who is in a relationship described in § 267(b) with any of the foregoing persons;

(h) the appraiser is not an appraiser who was regularly used by the decedent or who is regularly used by the taxpayer or the beneficiary or donee; and

(i) the appraisal fee is not based on the appraised value of the item of art;

(2) include the name, address, and taxpayer identification number (if a taxpayer identification number is otherwise required by § 6109 and the regulations thereunder) of the appraiser. If the appraiser is acting in his or her capacity as a partner in a partnership, an employee of any person (whether an individual, corporation, or partnership), or an independent contractor engaged by a person other than the taxpayer, the appraiser must include the name, address, and taxpayer identification number (if a taxpayer identification number is otherwise required by § 6109 and the regulations thereunder) of the partnership or the person who employs or engages the appraiser; and

(3) include the qualifications of the appraiser who signs the appraisal, including the appraiser’s background, experience, education, and membership, if any, in professional appraisal associations.

.05 The appraisal will not satisfy the requirements of this section if the taxpayer has knowledge of facts that would cause a reasonable person to expect the appraiser to overstate or understate the value of the item of art.