The question this answers
One question, and everything else follows from it: what was the property worth on the day the owner died?
That figure sets the basis the heirs take on. It supports the New Jersey inheritance return, and the federal one in the rare cases where a federal return is required at all.
The assignment is retrospective. We write the report now and date it then.
Which means the analysis runs on sales that closed around the date of death, not on what the market is doing while we work. That distinction is the entire job, and getting it wrong is the commonest fault in this kind of appraisal — a report that quietly borrows strength from a later market cannot be defended when somebody checks it.
Why New Jersey estates hit this more often than people expect
Because of a tax most families have never heard of until they meet it.
New Jersey stopped charging estate tax on deaths from 1 January 2018. It did not stop charging inheritance tax. Two taxes, two triggers, and the one that survived is the one that catches people.
Inheritance tax does not ask how big the estate is. It asks who is inheriting:
| Class | Who | What they pay |
|---|---|---|
| A | Spouse, civil union or domestic partner, child, stepchild, grandchild, parent, grandparent | Nothing |
| C | The decedent’s siblings; a child’s spouse or widow | First $25,000 free, then 11%–16% |
| D | Everybody else — nieces, nephews, cousins, friends | 15%–16% |
| E | Qualified charities | Nothing |
A house in Elizabeth left to a daughter attracts no New Jersey tax. The same house left to a sister does.
In the second case the date-of-death value matters a great deal, and it is painful to reconstruct years later from whatever happens to be left in a file.
The New Jersey return is due eight months after the death — a month ahead of the federal deadline, and usually the date that decides when the appraisal has to happen.
Basis is the part the heirs feel years later
Under IRC §1014, inherited property takes a basis equal to its market value at the date of death.
Put numbers on it. A house bought in 1987 for $115,000, worth $640,000 the day the owner died. The heirs’ basis is $640,000, not $115,000.
Sell it soon after for $650,000 and the gain is $10,000. Without the step-up it would have been $535,000. That gap is what this document is worth.
But a step-up is only as strong as what supports it. A beneficiary selling eight years on, with nothing in the file, is arguing for a number they cannot show. Commissioning the appraisal while the estate is still open costs a fraction of reconstructing one under audit.
The alternate valuation date
An executor can elect under IRC §2032 to value the estate six months after death instead. It is worth knowing the shape of it, because it is narrower than it sounds:
- Available only where it reduces both the gross estate and the estate tax actually payable.
- It covers the whole estate. You cannot apply it to one asset.
- It cannot be undone once made.
- Anything sold inside that six-month window is valued at the sale.
If the accountant is considering it, tell us at the start. It means two effective dates and two pieces of analysis, not one report with a different date on it.
When the house has already changed
Estates rarely arrive tidy. By the time anyone calls, the property has often been emptied, sometimes redecorated, sometimes sold.
None of that moves the effective date. What it changes is how condition gets established.
Where the interior can no longer be seen as it stood, the report works from what was recorded at the time — listing photographs, a home inspection, the executor’s own description — and then states openly that it is assuming the property was in that condition. Naming the assumption is a requirement of the standard. It is also the difference between a report that survives scrutiny and one that quietly hopes to avoid it.
If the property sold shortly after the death, that sale is real evidence and gets analysed as such. It is not automatically the answer — not where it went to a relative, never reached the open market, or moved under time pressure.
What you receive
A written report carrying a stated effective date, a market value conclusion, and the sales it rests on with the adjustments set out rather than asserted.
Extraordinary assumptions are disclosed. The certification is signed under USPAP. Delivery is digital, to the executor, and onward to counsel or the accountant when you instruct us in writing.
The fee and the turnaround are confirmed in writing before anything begins.
If there is a filing date in the way, say so on the call. It changes the order we do things in, not the analysis.
This page describes appraisal practice. It is not legal or tax advice. Elections, filings and deadlines are matters for the estate’s attorney and accountant.
New Jersey specifics
- New Jersey stopped charging estate tax on deaths from 1 January 2018. It did not stop charging inheritance tax, and the two are frequently confused.
- Inheritance tax turns on who inherits rather than on how much is inherited. Class A — spouse, civil union or domestic partner, child, stepchild, grandchild, parent, grandparent — pays nothing.
- Class C, meaning the decedent's siblings and a child's spouse or widow, takes the first $25,000 free and then pays 11% to 16%. Class D, which is everyone else including nieces, nephews and friends, pays 15% to 16%.
- The New Jersey return is due eight months after the death. Federal Form 706, where one is needed at all, is due at nine.
- A modest house left to a Class D beneficiary can generate New Jersey tax on an estate far too small to interest the federal government. That is why these appraisals are needed here more often than people expect.
What you receive
- A report whose effective date is the date of death
- A market value conclusion carried by sales that closed near that date
- Any extraordinary assumption or hypothetical condition named openly
- A certification signed under USPAP
- Delivery to the executor, and onward to counsel or the accountant on written instruction
What we need from you
- The date of death
- The address, and the block and lot if the assessment notice is to hand
- Who is executor or administrator, and who may receive the report
- Access to inspect — or word that the property has been sold, cleared or altered
- Anything you know about its condition as it stood on the date of death