An appraisal survey may be conducted for a number of reasons, including:
Donation to a charity (tax purposes)
An appraisal survey inspection is similar to an insurance condition and valuation survey, but with an abbreviated report. The vessel’s condition needs to be clearly defined to provide an accurate valuation. The report will identify valuation methodology, assumptions as to the operating condition of machinery and other systems, as well as limitations of inspection.
For charitable donations, the IRS requires boats with a value of $5,000 or more to be appraised by a qualified professional. This is typically done by a marine surveyor. The surveyor will fill out the appropriate sections of IRS Form 8283 “Noncash Charitable Contributions” and provide a signed original along with the appraisal survey report.
The IRS rules for donations of boats, cars, RVs, etc. changed in 2006. Anybody contemplating donation of a boat to a charity should fully investigate all of the benefits and possible complications. This should include consultation with a CPA or tax attorney.