Whether you have a painting, sculpture, or an old set of china, you should have valuable items appraised regularly. This way, you'll know what your items are worth. However, you may want to have different evaluation methods done with each appraisal. Which method you have done should be dependent upon what is going on at the time and what your plans are for the item before the next appraisal. Here is some information to help you understand the different methods and which you should use.
Insuring Your Belongings
Art, antiques, and jewelry should be appraised by an independent appraiser when you are getting ready to insure them or change the insurance on them. Since the reason you pay for the insurance is to be able to replace the item, you should ask the appraiser for a retail replacement value evaluation. This type of evaluation usually disregards the condition of the item. This is the amount it would cost you to buy the item again. If the item is no longer being made and sold in a retail setting, this amount would be determined by the average going price from a reputable dealer or auction house.
Selling the Item
If you are considering selling something of value to you, you need to know how much you should be asking for it. This is where the fair market value evaluation method comes into play. When this method is used, the condition of the item will be considered. The appraiser will research the item, using auction houses, online auctions, and dealer information to determine its value. This evaluation will let you know how much people are willing to pay for the item you are selling, in the condition it is in.
Legal and Tax Matters
Another reason for an appraisal involves legal and tax issues. If you are donating the item, you will need to know what it is worth so you can write it off on your taxes. In addition, if you are preparing your will, the value of the item may come into play for the recipient. In a divorce or death situation, a fair split of possessions may mean that you'll need to have things appraised to determine who gets what. This method is referred to as the liquidation value.
While all three methods of appraisals should result in amounts that are somewhat equal, there will be discrepancies. Talk with the appraiser to ensure you are getting the proper value for your items. You may even ask to have all three methods used so you have complete knowledge of what your belongings are worth, no matter what your plans are for them. To learn more about art appraisal, contact a company like Wardell Appraisals.