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Commercial Appraiser-Appraisal 310.337.1973 - COMMERCIAL APPRAISER, CONVERGENCE, PRESIDENT TRUMP INVO
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« COMMERCIAL APPRAISER, CONVERGENCE, PRESIDENT TRUMP INVO | Main | looney_conservationeasements.pdf »

April 26, 2019

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Commercial Appraiser CRE BLOG, 310.337.1973
1.

https://commercialappraiser.typepad.com/.services/blog/6a00e552a58b6c88330147e276c589970b/search?filter.q=appraisal+institute%2C+mai

Commercial Appraiser CRE BLOG, 310.337.1973
2.

Conservation Easement Appraisals for Tax –
Where Are We Going This Morning?
Ø Discuss a challenging, interesting and profitable
area of appraisal practice.
Ø Discuss appraisal issues and related concerns that
have arisen in recent Tax Court cases.
Ø Help with suggestions on appraisal practice to help
keep taxpayer clients happy and keep them and
you away from the penalties.
Ø Offer some protective terms for engagement
agreements.
Ø Have a good discussion. https://www.appraisalinstitute.org/assets/1/29/AI_Annual_Meeting,_Conservation_Easement_Appraisal_Topics,_7-29-15.pdf


But In This Older Case, Maybe the Appraisers Weren’t
Doing Such a Good Job – Using a URAR to Appraise a
Façade Easement. Believe It or Not?
Rothman v. Comm’r, T.C. Memo. 2012-163 – Tax Court considered an
appraisal for a building façade easement deduction:
• Four-story townhome in Brooklyn.
• Façade easement donated to NAT.
• In support of deduction, taxpayer submitted an appraisal.
• Tax Court: “In a uniform residential appraisal report, [the
appraisers] estimated the market value of the subject property as
$2.6 million as of September 15, 2004.”
• Appraisers then had a boilerplate addendum generally discussing
the impact of CEs on property values and offered their “opinion.”
Believe It or Not?
Using a URAR to Appraise a Façade Easement
Rothman v. Comm’r:
• Appraisers: “It is our opinion that the presence of the façade
conservation easement would alter the market value of the
subject property. . . The appraiser cannot precisely estimate the
extent to which this ‘loss in value’ will result from the façade
easement due to lack of market data. In this situation it is the
appraiser’s conclusion that the value of the façade easement on
the subject property would be estimated at $290,000, which is
approximately 11.15% of the fee simple value of $2,600,000. This
conclusion is based on consideration of the range of value that
the I.R.S. Has [sic] historically found to be acceptable as well as
historical precedents.”
Believe It or Not?
Using a URAR to Appraise a Façade Easement
Rothman v. Comm’r:
• Tax Court: “This Court, in [ ] T.C. Memo. 2010-151, was presented
with an appraisal report identical in all material respects, including
the typographical errors, to the one petitioners obtained.” (For a
different property.)
• Tax Court: “The appraisal applies the wrong standard of value.”
• Tax Court: “Applying a fixed percentage to the before value of the
subject property, without explanation, does not constitute a
valuation method under section 1.170A-13(c)(3), Income Tax Regs.”
Engagement Letter Tip #1

Commercial Appraiser CRE BLOG, 310.337.1973
3.

Conservation Easement Appraisals for Tax –
Where Are We Going This Morning?
Ø Discuss a challenging, interesting and profitable
area of appraisal practice.
Ø Discuss appraisal issues and related concerns that
have arisen in recent Tax Court cases.
Ø Help with suggestions on appraisal practice to help
keep taxpayer clients happy and keep them and
you away from the penalties.
Ø Offer some protective terms for engagement
agreements.
Ø Have a good discussion.

https://www.appraisalinstitute.org/assets/1/29/AI_Annual_Meeting,_Conservation_Easement_Appraisal_Topics,_7-29-15.pdf

Commercial Appraiser CRE BLOG, 310.337.1973
4.

Politics aside, I actually found the discussion of developers using syndicated conservation easements as a tax avoidance model pretty interesting. If you cross-reference it, you'll find it's a real thing.

Apr 27, 2019 03:27 PMReport Comment Upvote
Commercial appraiser
Commercial Appraiser/Forensic Consul
IT'S REAL ALRIGHT! THE MAI, AI, APPRAISAL INSTITUTE APPRAISED 100% OF THE APPRAISAL INVOLVED. YOU CAN READ THE POST FOR THE $ MAGNITUDE. NO OTHER APPRAISERS LICENCED OR OTHERWISE PARTICIPATED IN THIS MESS. https://activerain.com/questions/show/68255/commercial-appraiser--convergence--president-trump-involved-in-ric0--conservation-easement--tax-scheme--will-he-pardon-co-conspirators---mai--ai-appraisal-institute--#1164062

Commercial Appraiser CRE BLOG, 310.337.1973
5.

President Trump participated in dubious tax schemes during the 1990s, including instances of outright fraud, that greatly increased the fortune he received from his parents, an investigation by The New York Times has found.

Mr. Trump won the presidency proclaiming himself a self-made billionaire, and he has long insisted that his father, the legendary New York City builder Fred C. Trump, provided almost no financial help.

But The Times’s investigation, based on a vast trove of confidential tax returns and financial records, reveals that Mr. Trump received the equivalent today of at least $413 million from his father’s real estate empire, starting when he was a toddler and continuing to this day.

Much of this money came to Mr. Trump because he helped his parents dodge taxes. He and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents, records and interviews show. Records indicate that Mr. Trump helped his father take improper tax deductions worth millions more. He also helped formulate a strategy to undervalue his parents’ real estate holdings by hundreds of millions of dollars on tax returns, sharply reducing the tax bill when those properties were transferred to him and his siblings.

These maneuvers met with little resistance from the Internal Revenue Service, The Times found. The president’s parents, Fred and Mary Trump, transferred well over $1 billion in wealth to their children, which could have produced a tax bill of at least $550 million under the 55 percent tax rate then imposed on gifts and inheritances.

The Trumps paid a total of $52.2 million, or about 5 percent, tax records show.

The president declined repeated requests over several weeks to comment for this article. But a lawyer for Mr. Trump, Charles J. Harder, provided a written statement on Monday, one day after The Times sent a detailed description of its findings. “The New York Times’s allegations of fraud and tax evasion are 100 percent false, and highly defamatory,” Mr. Harder said. “There was no fraud or tax evasion by anyone. The facts upon which The Times bases its false allegations are extremely inaccurate.”

Mr. Harder sought to distance Mr. Trump from the tax strategies used by his family, saying the president had delegated those tasks to relatives and tax professionals. “President Trump had virtually no involvement whatsoever with these matters,” he said. “The affairs were handled by other Trump family members who were not experts themselves and therefore relied entirely upon the aforementioned licensed professionals to ensure full compliance with the law.”

[Read the full statement]

The president’s brother, Robert Trump, issued a statement on behalf of the Trump family:

“Our dear father, Fred C. Trump, passed away in June 1999. Our beloved mother, Mary Anne Trump, passed away in August 2000. All appropriate gift and estate tax returns were filed, and the required taxes were paid. Our father’s estate was closed in 2001 by both the Internal Revenue Service and the New York State tax authorities, and our mother’s estate was closed in 2004. Our family has no other comment on these matters that happened some 20 years ago, and would appreciate your respecting the privacy of our deceased parents, may God rest their souls.”

The Times’s findings raise new questions about Mr. Trump’s refusal to release his income tax returns, breaking with decades of practice by past presidents. According to tax experts, it is unlikely that Mr. Trump would be vulnerable to criminal prosecution for helping his parents evade taxes, because the acts happened too long ago and are past the statute of limitations. There is no time limit, however, on civil fines for tax fraud.

The findings are based on interviews with Fred Trump’s former employees and advisers and more than 100,000 pages of documents describing the inner workings and immense profitability of his empire. They include documents culled from public sources — mortgages and deeds, probate records, financial disclosure reports, regulatory records and civil court files. https://www.nytimes.com/interactive/2018/10/02/us/politics/donald-trump-tax-schemes-fred-trump.html

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