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US Court of Appeals Finds Appraiser’s Report Is Discoverable, and Not Protected by Attorney/Client Privilege

Appraiser’s Documents

The US Court of Appeals found that an IRS summons for an appraiser’s report was in good faith and resulted in the appraiser’s report being discoverable by the IRS.  In the case, the taxpayer had an appraisal done of an area of land.  The land was valued at over $1,000,000 of which a charitable donation was made.

The couple deducted the gift as a charitable deduction over a period of years.  The caveat was that the appraisal was done via the request by an attorney for the taxpayer.  When the IRS called the appraisal into question, the taxpayer and attorney refused the summons due to attorney/client work product.

Editor’s Comment

Had this document been prepared in anticipation of litigation, it could have qualified for work product doctrine exception.  The court in this opinion gave a scathing review of the taxpayer’s strategy to withhold the evidence as completely improper.  It is important that the public understands that if an appraisal is done, the end product is discoverable by courts.  This case is a good example of why a solid appraisal by a qualified appraiser should be done in every instance.

By: Basi & Basi at the Center for Financial, Legal and Tax Planning for Transworld M&A Advisors