Why Seek Appraiser and Auction Consultant Services?

An auction consultant/personal property appraiser’s primary purpose is to help solve problems with property. Two recent articles (one in the The Huffington Post and one in The Wall Street Journal) informs and illustrates how consultant/appraisers might assist you when it is time to solve problems with your property:

David Burton’s Huffington Post article, “The Four D’s in Personal Property Appraisal: Death, Disaster, Debt and Divorce” is a thorough description of how an appraisal helps with personal property issues. Essentially, you need a particular value for a particular reason. Whether that reason is to insure your items or to provide a basis to equitably distribute property. To read this article click here.

I understand that getting an appraisal isn’t at the top of most people’s lists of a fun way to invest their money. Most people would probably prefer to put it off or never get the appraisal at all. But appraisals are necessary to solve particular problems. Would you prefer to know the value of your treasured item – or have your insurance company tell you the value? I happily work with clients after a piece of property is destroyed to determine the value and the replacement cost. However, if an item has been damaged, you may be in the midst of other financially complicated problems. Having an insurance appraisal before disaster strikes can provide some peace of mind.

The majority of my work in recent years has been writing appraisal reports for non-cash charitable contributions. These donations result in a client receiving a tax incentive for their donation. An appraisal is necessary to justify that tax deduction. Still, appraisals are easy to put off. I especially notice this when my phone starts ringing at the end of the year. Providing an appraisal report is neither quick nor easy, nor should it be. When you are working with high-end property and the requirements of the IRS require a specialized skill set because they are complicated and, of course, take time to produce. Waiting until the end of the year will, most likely, put your donation appraisal into the following tax year.

The other article comes from The Wall Street Journal writer Daniel Grant and is titled, “Art Auction Houses Want to Deal.” Grant summarizes some of the areas where auction houses are willing to negotiate their fees. If you have never worked with an auction house or aren’t familiar with the auction process, his points may surprise you. This is precisely why I provide auction-consulting services. To read this article click here.

Having someone familiar with the process and negotiating on your behalf, saves you time and headache.

Many of my clients are celebrities, their heirs, or collectors. When they downsize or decide to share their collections, they have a variety of options. Not all property needs to be sold at auction, an entire collection does not need to be donated. A combination of options can be employed. A consultant will work with a client to determine what will sell best at auction, what will benefit an archive or museum with your donation, and what is best to simply send away to a second hand store or the trash. Celebrities and public personalities in particular have a certain level of privacy to maintain. By working with Mahn Miller Collective, Inc. clients can be confident that all options are considered; that their best interests and reputation are being protected.

“Putting a price on Prince collectibles: Don’t be fooled by rip-offs”

I recently spoke to Kim Palmer of the Star Tribune about Prince Memorabilia.

Putting a price on Prince collectibles: Don’t be fooled by rip-offs

The musician’s sudden death boosts demand for related memorabilia. But be wary of rip-offs.


When Prince died, Megan Mahn Miller felt the same shock and sadness shared by many Minnesotans. But because of her profession, she also knew what would inevitably follow: a flood of people buying and selling Prince-related memorabilia, some of it authentic, and some just a moneymaking scam.

“As an appraiser and auction professional, I run the risk of looking like an ambulance chaser if I start discussing the crass realities of property, money and death,” she wrote in a blog post on her website (mahnmiller.com). “Here is the reality. When a celebrity dies, more of their memorabilia hits the market.”

Grieving fans want to possess a link to a celebrity they loved and admired, and others see an opportunity to cash in. “Some are legitimate, but some are criminals.”

Mahn Miller of Minneapolis is an expert on celebrity memorabilia. She’s a property specialist for Julien’s, a California-based auction house, and she also runs her own appraisal company, Mahn Miller Collective Inc.

“The rock’n’ roll memorabilia market is insane right now,” she said, and a sudden death of a high-profile musician can trigger a buying and selling frenzy.

Would-be collectors need to take a deep breath and avoid buying on impulse. The value of a Prince artifact is determined by the same factors that determine value for any piece of memorabilia: provenance (origin), age, condition and scarcity, according to Mahn Miller.

A paper flier from the 1970s advertising a Prince appearance could have more value than a more durable artifact, she noted, “because that’s the kind of thing people tend to crumple up and throw away.”

If you want to own something relating to the life or career of Prince, be careful, do your research and try to make certain that you are buying from a reliable source, she cautioned. “Ask a lot of questions. It’s on them [the seller] to prove to you that what they have is genuine.” If the seller claims that an item was worn or played by Prince, ask for or look for a photo showing that the musician had contact with the item.

Fan forums can be a good source of information, she said. “They know better than anyone what’s authentic. … You can also research people online. Companies that sell fake memorabilia get sniffed out and develop a reputation.”

The longer-term market for Prince memorabilia remains to be seen. “We won’t know for another year,” she said.

A few deceased celebrities, such as Elvis Presley and Marilyn Monroe, have stayed in consistently high demand. The market for Michael Jackson memorabilia after his sudden death followed a different arc. “It experienced a tremendous peak right away, stayed high for a few years, and has gone back down,” she said.

Scarcity may keep the market robust for Prince memorabilia. “The Prince market was already strong,” said Mahn Miller. “In the rush to get property to market, you run the risk of inundating the market, but I don’t see that happening with Prince. There’s not enough property, and there’s a lot of interest. He died so young. It’s not like a Frank Sinatra who had a longer time to amass things. And Prince was a private person. Michael Jackson signed more autographs.”

Before Prince’s death, the priciest piece of Prince-ly memorabilia was the handwritten lyrics for “Purple Rain,” which sold for $70,000 in 2010. Prince guitars have sold for up to $30,000, Prince clothing for $2,500 to $5,000, and signed documents for $600 to $1,000, she said.

Bottom line: Buy something only because you value it personally, not because you’re hoping it will appreciate substantially in monetary value. “The most important thing is to be sure to buy a piece you love,” said Mahn Miller. “Buy a piece you love, and it will always have value for you.”

And approach any potential purchase with a grain of skepticism.

“If it looks to be too good to be true, it probably is,” Mahn Miller said. “If someone is trying to sell a Prince guitar for $300, it probably isn’t a Prince guitar.”



Recent article summarizes the importance of a professional appraisal

A recent article from ThinkAdvisor explains the need to get a professional appraisal for non-cash charitable donations.

The title is a bit off-putting but the article contains great information to those new to needing and procuring an appraisal.  The article points out that the appraiser you hire should be an experienced in the subject they are appraising.  It’s good advice.

Noncash Charitable Donations: Proceed With Caution

Extreme care is necessary to gain maximum tax benefit from noncash gifts

Taxpayers can avoid major capital gains exposure by gifting noncash assets to nonprofit organizations.

Donor-advised funds, in particular, have experienced a surge in noncash contributions by account holders, including privately held C or S corporation stock, real estate, insurance, vacation home, LP or LLC interests.

For example, Fidelity Charitable reported an 18% year-over-year increase in contributions of noncash assets in 2015.

However, donors and their advisors must ensure that they are doing the appropriate documentation of noncash gifts. Failure to do so can result in a gift being disallowed as a charitable deduction, and may incur penalties.

In a recent advisory, American Endowment Foundation said taxpayers must file Form 8283 for certain noncash contributions:

  • $500 or more: Donor must include Form 8283 with his or her income tax return
  • $5,000 or more ($10,000 for closely held stock): Donor will generally need to have the gift appraised and report the appraiser’s findings in Section B of Form 8283
  • $500,000 or more: Donor must attach the qualified appraisal, along with Section B of Form 8283, to his or her tax return.

A tax easement donation case decided last year by the U.S. Tax Court underscores the importance of following these rules to the letter.

A Chicago area couple granted a façade easement to the Landmarks Preservation Council of Illinois on their century-old residence, which was listed on the National Register of Historic Places and located in a neighborhood designated as a historic district by the National Park Service.

Enter the Internal Revenue Service, which pays special attention to charitable deductions, according to AEF.

The court agreed with the IRS’ argument that the charitable deduction claimed by the couple should be disallowed because they failed to include a qualified appraisal of the easement with their return.

It also said they were liable for 20% penalties for disregarding the rules and regulations or, alternatively, for 40% penalties for making gross valuation misstatements on their jointly filed income tax returns.

AEF noted that the Internal Revenue Code, the instructions for Form 8283 and the commentary from the Joint Committee on Taxation’s Technical Explanation make clear that an appraisal should have been attached to the return.

In the Chicago case, the tax preparers and the donors failed to attach the appraisal to the tax forms as required — even though an appraisal had been completed.

Appraisal’s Role

AEF said that if a donor needs an appraisal for a noncash contribution, the gift must be made within 60 days after the date of the appraisal. Or it can be appraised after the date of the gift, in which case the appraisal would need to state the gift’s value on the date it was made.

In addition, the appraisal must be received by the due date (including extensions) of the return on which the deduction is first claimed.

According to AEF, a qualified appraisal is an appraisal document that is made, signed and dated by a qualified appraiser in accordance with generally accepted appraisal standards and otherwise complies with the qualified appraisal requirements.

For larger noncash gifts, both an appraisal and Section B of Form 8283 are required. Section B must be signed by the appraiser and by the charity that received the client’s gift, and must be attached to the donor’s tax return.

AEF said it is also important that the donor use an appropriate qualified appraiser.

This is an individual who has earned an appraisal designation from a professional appraiser organization, or has met minimum education and experience requirements in the subject matter in which he or she issues appraisals. A qualified appraiser regularly performs appraisals, and receives compensation for his or her work.

Generally, no part of the appraisal fee can be based on a percentage of the item’s appraised value, according to AEF. A fee is not a charitable gift. If itemized, the appraisal fee is deductible on the income tax return as a miscellaneous deduction.

According to AEF, a noncash gift may be more appropriate for some donors than a cash one. This can be determined by using its calculator.

Fast Talking Podcast With Andy Imholte

Andy Imholte graciously let me come on his show.  We talk about comparable sales, the memorabilia market, the Graduate Personal Property Appraiser (GPPA) designation, and more.

106: Appraising Memorabilia: Megan Mahn Miller

With the success of programs like Antiques Roadshow, many people think they own valuable collections or items. However, interest does not always mean value. To dig into the topic of appraisals Andy welcomes Megan Mahn Miller, property specialist with Julien’s Auctions to discuss her experience valuing items that could be considered priceless.

Great Information When Getting an Appraisal for Tax Deduction

Many of the appraisals I provide are for donation. It is important to communicate with your accountant about the tax benefit of an appraisal. Market Watch just published this article with helpful information:
What to know when deducting charitable donations

What to know when deducting charitable donations

By Bill Bischoff
Published: Feb 23, 2016 5:11 a.m. ET

Since no good deed goes unpunished, the federal income tax rules for deducting personal charitable donations are complicated. Here’s what you need to know to claim your rightful deductions:

Charitable deduction basics

Depending on the type of charity and whether you contribute cash or other stuff, your charitable write-off can potentially be limited to 20%, 30% or 50% of your adjusted gross income (AGI). AGI is the number at the bottom of Page 1 of your Form 1040. It includes all taxable income items and selected write-offs such as the ones for alimony paid and moving expenses. Contributions that exceed the applicable AGI limit can be carried over for up to five years and hopefully deducted in those future years.

Documentation requirements

You can only deduct donations for which you have the required documentation. Here are the details on the documentation rules.

Cash donations under $250

To deduct a cash donation of $250 or less, the best proof of your generosity is a canceled check or credit card statement. Preferably, you should also get a receipt from the organization showing its name, the date and place of the contribution, and the amount given. For small cash donations, say to your church when attending weekly services or to the Salvation Army around the holidays, keep a log to satisfy the IRS.

Noncash donations under $250

To deduct the donation of a noncash item worth less than $250, you need a receipt — like the familiar slips you get for donations to Goodwill. The receipt should show the organization’s name, the date and place of the donation, and a description of what you donated. You may have to fill in most of this information yourself. You must also place a value on the donated item(s). Finally, you must have the receipt in hand by the time you file your return to claim your rightful deduction.

Cash donations of $250 or more

To deduct cash donations of $250 or more, canceled checks or other evidence supplied by you is not good enough for the IRS. Instead you must collect from the charity a contemporaneous qualified written acknowledgment (more detailed than a simple receipt) that meets IRS guidelines. You need to have this acknowledgment in hand by the time you file your return in case you get audited. If you do get audited and don’t have it, you lose the deduction even though there may be no doubt you made the donation.

An acknowledgment meets the contemporaneous requirement if you obtain it on or before the earlier of: (1) the date you file your Form 1040 for the year you made the donation or (2) the due date (including any extension) for filing that return. If you don’t have a qualified acknowledgment in hand by the applicable magic date, you won’t be able to get credit for your charitable deduction.

Noncash donations of $250 to $5,000

To deduct a donated noncash item worth $250 to $5,000, you need a contemporaneous qualified written acknowledgment plus written evidence that supports the item’s acquisition date, its fair market value, how much it cost, and so forth. You’ll need this information to fill out IRS Form 8283 (see below). Keep the acknowledgment and the written evidence (which may simply be notes that you’ve prepared yourself) with your tax records, but don’t file them with your return.

Key point: If your total noncash donations for the year exceed $500, you must fill out IRS Form 8283 (Noncash Charitable Contributions) and include it with your return.

Noncash donations of more than $5,000

To deduct the donation of an item valued at more than $5,000, you generally must collect a contemporaneous qualified written acknowledgment, file Form 8283 with your return, and obtain a qualified written appraisal for the item. You must have the appraisal in hand by the time you file your return. Stricter appraisal rules apply to contributions of artwork worth $50,000 or more. You can write off the appraisal fee as a miscellaneous itemized expense that is subject to the 2%-of-AGI deduction threshold.

Key point: No appraisal is required for donations of publicly traded securities.

Donations of clothing and household items

For donated clothing and household items (such as furniture, furnishings, electronics, and appliances), all the preceding documentation rules apply. In addition, the general rule for these items says you can only claim deductions for stuff that is in “good condition or better.” However, you can deduct the fair market value of an item that is not in good condition or better if you attach a qualified written appraisal that values the item at more than $500. For example, this rule might apply to a donated antique that’s fairly valuable despite being in not-so-great condition.

Donations of appreciated securities

When you contribute appreciated securities, please be sure to give away only those you’ve owned for more than one year. That way you can deduct the full market value and permanently avoid any capital gains tax on the appreciation. In contrast, when you donate appreciated securities you’ve held for 12 months or less, your deduction is limited to the cost of the securities, which may be much lower. As mentioned earlier, no appraisal is required for donations of publicly traded securities.

Donations of vehicles, boats, and planes

You’ve probably heard many radio and TV ads asking for charitable donations of used vehicles. In addition to all the aforementioned documentation guidelines, special rules apply to donated motor vehicles, boats, and planes.

For a vehicle (or boat or plane) valued at $500 or less, you can deduct the fair market value (FMV).
If the FMV exceeds $500 and the charity simply sells the vehicle (or boat or plane), your deduction is limited to the sale price. Since charities often sell donated vehicles at used car auctions, the sale price might be significantly less than FMV. On the other hand, if the charity uses the vehicle in its tax-exempt purpose (for example, to deliver items to the needy), you can deduct the full FMV. Ditto if charity makes significant improvements to the vehicle (for example, rebuilding the engine or transmission). Minor dent removal and a paint job don’t count as significant improvements.
No deduction is allowed for donating a vehicle (or boat or plane) for which the claimed value exceeds $500 unless you receive a contemporaneous qualified written acknowledgment from the charity. Usually, the charity will supply you with IRS Form 1098-C (Contributions of Motor Vehicles, Boats, and Airplanes) as the acknowledgment.
Limitation on deductions for noncash donations

If you contribute a noncash item (other than securities), your deduction is limited to the item’s tax basis (generally what you paid for it) unless the item is used in the charity’s exempt purpose. For example, if you donate a painting with a basis of $2,000 and a FMV of $75,000 to a children’s shelter, your deduction will be only $2,000. But if you donate the painting to a museum that will display it in a gallery, you can deduct the full $75,000 FMV. Big difference!

Phase-out rule for high-income individuals

Unfortunately, itemized deductions for charitable donations are affected by a phaseout rule that can potentially wipe out up to 80% of your otherwise deductible amounts. (This phaseout rule also affects itemized write-offs for home mortgage interest, state and local taxes, and most miscellaneous deduction items.)

For the 2015 tax year, the phaseout rule kicks in when adjusted gross income (AGI) exceeds $258,250 for singles, $309,900 for married joint-filing couples, $284,050 for heads of households, and $154,950 for married individuals who file separate returns. AGI is the number at the bottom of Page 1 of your Form 1040. It includes all taxable income items and is reduced by selected write-off such as alimony paid and moving expenses.

Under the phaseout rule, the total amount of affected itemized deductions is reduced by 3% of the amount by which AGI exceeds the applicable threshold. However, the reduction cannot exceed 80% of the affected deductions that you started off with.

Key point: Most folks are untroubled by the itemized deduction phaseout rule, and even when it does apply it does not make a big difference unless you are really raking it in.

Itemizing versus claiming standard deduction

You can claim either the applicable standard deduction or itemized deductions, but not both. If you have enough itemized deductions to exceed your standard deduction amount, you should itemize using Schedule A (Itemized Deductions), which is filed with your Form 1040.

If you don’t have enough itemized write-offs, claim the standard deduction. For 2015, the standard deduction amounts are $6,300 for singles, $12,600 for married joint-filing couples, $9,250 for heads of households, and $6,300 for married individuals who file separately.

Where to claim your rightful charitable deductions

Deduct cash donations on Line 16 of Schedule A.

Deduct noncash donations on Line 17.

Favorite New Podcasts

As Serial is down to every other week I needed to find some new podcasts. And if they help me become a more knowledgeable appraiser – so much the better.

I stumbled upon You Must Remember This written and hosted by Karina Longworth and I am hooked. Described as a podcast “about the secret and/or forgotten histories of Hollywood’s first century.” Longworth’s episodes also venture into the world of pop music. It is a delight. Check it out here: www.youmustrememberthispodcast.com/episodes/

Closer to (my) home, the Fast Talking Podcast hosted by Andy Imholte is described as offering a “unique perspective to both industries has helped him create a unique blend of experience and knowledge valuable to auctioneers.” Topics covered will also be of interest to appraisers. I particularly enjoyed an episode on personal safety with guest Rich Schur. I recently talked Andy into putting me on an episode and he kindly agreed. It is supposed to air in February. Find that and more here: www.fasttalkingpodcast.com/new-blog/

Stuff You Missed In History Class makes me feel like I am getting away with something. It’s brainy but it also feels like brain candy. I was especially fond of the Prohibition episode where I learned about the origins of NASCAR. Get educated and entertained here: www.missedinhistory.com/podcasts/

What’s it worth? Ask the appraiser

Five questions with Minneapolis appraiser Megan Mahn Miller.

Megan Mahn Miller is an appraiser and auctioneer.

It’s also Megan Mahn Miller’s bread and butter. The Minneapolis native studied art history at the University of Minnesota, Morris, moved to Los Angeles, where she landed a job with Julien’s Auctions, and launched a career as an appraiser and licensed auctioneer, specializing in rock’n’roll and Hollywood memorabilia.

Now back living in her hometown, she’ll be at Junk Bonanza on Thursday, joining master appraiser Tim Luke for a free presentation on hot collectibles; how to shop flea markets, estate sales and auctions, and how to know what makes something a future collectible.

Q: So what is a hot collectible these days?

A: It’s constantly changing. In my industry, what’s consistent are certain celebrities, like Elvis and Marilyn Monroe. I don’t see those people ever losing value.

Q: How about what’s not hot?

A: The poster market is a cautionary tale. It was huge seven to 10 years ago, with people getting enormous sums of money, but the market has kind of tanked. You really need to love what you’re collecting. Also Longaberger baskets. People were spending hundreds of dollars on baskets that are now worth 50 bucks. People get an idea of something, and the market takes off. But novelties that are mass-produced are short-term. … Scarcity: That’s what drives the market.

Q: You’re one of the appraisers participating in a new online valuation site. Tell us about it.

A: The “Cash in the Attic” [www.cashintheattic.com] site started in the U.K. Now it’s launching in the U.S. It allows you to get an appraisal without standing in line or paying a lot of money. You e-mail a photo and a description, and [within 48 hours, for a fee] you get a valuation. It’s like 100 appraisers sitting in your computer. What I like about it is it’s a jumping-off point. You avoid the humiliation of bringing it in and finding out it’s worth $2. And if it’s worth $10,000, maybe it’s time to get it insured.

Q: What about other online resources, like eBay?

A: Take them with a grain of salt. There can be a wide range of prices, and if it’s still posted, they have not gotten that price.

Q: What do you collect?

A: At the end of the day, it appears cat hair. … No, I’m not a collector. My husband collects records, and I met him at a thrift store, Arc’s Value Village. I do love upcycled stuff. The thing I love about Junk Bonanza is it’s juried, everything’s vetted. It’s misnamed. There’s not going to be any junk.