Real Estate Appraisal Glossary

A certified appraisal that determines the Fair Market Value of real property as of the exact date the owner passed away. Required by the IRS for estate tax filings (Form 706) and by probate courts to ensure equitable distribution of inherited assets. Unlike a standard appraisal, the appraiser must analyze historical market conditions and comparable sales from the specific date — sometimes years in the past.

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The price at which a property would change hands between a willing buyer and a willing seller, both having reasonable knowledge of all relevant facts, and neither being under any compulsion to buy or sell. Fair Market Value is the legal standard used by the IRS, probate courts, and family law courts for all estate and divorce-related property valuations in Washington State.

Recently sold properties that are similar in size, location, condition, age, and features to the subject property being appraised. Licensed appraisers analyze comparable sales to determine Fair Market Value using the Sales Comparison Approach. For retrospective appraisals, the comparable sales must be from the same time period as the date of death — not current sales.

The Uniform Standards of Professional Appraisal Practice — the ethical and performance standards governing all licensed real estate appraisers in the United States. Established by the Appraisal Standards Board, USPAP compliance is required for appraisals submitted to the IRS, probate courts, family courts, and financial institutions. A USPAP-compliant report ensures the appraisal was conducted with independence, impartiality, and objectivity.

Appraisal services specifically designed to assist attorneys and their clients during legal disputes involving real property. This includes producing court-admissible appraisal reports, providing expert witness testimony, reviewing and rebutting opposing appraisals, and preparing forensic valuation analyses. A litigation support appraiser must be able to defend their methodology and conclusions under cross-examination in a court of law.

A tax provision under U.S. federal law that resets the cost basis of inherited property to its Fair Market Value on the date of the original owner's death. When heirs inherit property, their new tax basis is the Date of Death value — not the original purchase price. This dramatically reduces capital gains taxes when the property is later sold. A certified Date of Death appraisal is the legal document that establishes this stepped-up value with the IRS.

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The federal tax return filed with the IRS when a decedent's gross estate exceeds the federal estate tax exemption. Form 706 requires a certified appraisal for all real property in the estate, establishing Fair Market Value as of the date of death. The appraisal must be USPAP-compliant and performed by a qualified appraiser as defined by IRS regulations.

An appraisal that establishes the value of a property at a specific past date rather than the current date. The appraiser must go back in time to analyze the market conditions, comparable sales, and property condition as they existed on that exact date — using historical MLS records, archived data, and forensic research. Retrospective valuations are most commonly required for Date of Death appraisals, but may also be needed for litigation, tax disputes, or insurance claims.

The legal court process through which a deceased person's estate is administered under court supervision. During probate, a judge validates the will, appoints an executor, oversees the payment of debts, and authorizes the distribution of assets to heirs. In Washington State, probate proceedings are handled by the Superior Court in the county where the deceased resided — Snohomish County Superior Court for Everett, Lynnwood, and Mukilteo; King County Superior Court for Seattle, Bellevue, and Redmond.

An independent, third-party property appraisal ordered during divorce or legal separation proceedings to establish an objective Fair Market Value for shared real estate. Because the appraisal is performed by a neutral licensed appraiser with no financial interest in the outcome, it provides a legally defensible value that both parties and their attorneys can rely on for equitable asset distribution. Washington State family courts accept USPAP-compliant appraisals as evidence in contested divorce proceedings.