Date of Death & Estate Update Appraisals

When a property owner passes away, the IRS requires that real estate be appraised at its Fair Market Value (FMV) as of the date of death.

This retrospective appraisal establishes the stepped-up cost basis, which can significantly reduce capital gains taxes for the heirs when the property is sold in the future.

Our certified appraisers provide court-ready, USPAP-compliant reports accepted by the IRS, probate courts, trustees and estate attorneys throughout Orange County, CA.

Fair Market Value (FMV) is defined as the price at which property would sell between a willing buyer and a willing seller, with under any pressure to buy or sell, and both having reasonable knowledge of the relevant facts.

This is the standard used by the IRS, California courts, and estate attorneys for probate, trust administration, tax reporting, and estate settlements.

A qualified appraisal is required by the IRS to substantiate the stepped-up basis. Our reports meet all IRS requirements under IRC §1014.

Residents of community property states, like California, can use the double step-up in basis rule. This allows a step-up in basis for community property—assets accumulated during marriage, excluding inheritances and gifts—for the surviving spouse.

Always consult with your RE Attorney, Tax Professional and Financial Advisor.

A DOD appraisal determines the Fair Market Value of the property as of the date of passing, based on the home's condition at that time.

It is best to order this within 1–3 months while market data is fresh and readily available.

If the appraisal is requested months or years after the date of death, the appraiser researches market data from that original date and values the property based on the condition it was in at that time.

For estate tax purposes or disposition of the assets of a decedent, a Date of Death valuation is often required — yet many Executors and family members are unaware.

If any improvements have been made after the date of death, the appraiser needs to be informed.

In some cases, the Executor may choose an Alternate Valuation Date (six months after the date of death). The same principles apply. The Appraiser needs to be notified about this Change of Date, to pull the correct market data.

Estate settlement appraisals establish the current fair market value of real property for distribution among heirs, trust administration, or sale. Whether the estate is going through probate or being administered through a living trust, an independent certified appraisal is essential.

Estate Executors may request an updated market analysis approximately every 5 years — particularly for ongoing trusts, long-term estate administration, or when property values have shifted significantly since the original appraisal.

Even with a Will, real property may still go through Probate.

Court-assigned Probate Referees perform drive-by valuations only. A full independent appraisal provides a more accurate value based on the home's actual condition at the date of passing.