Step-Up Basis Commercial Appraisals
When commercial real estate is inherited, heirs and their tax advisors often need a defensible value as of the date the basis is established. We provide appraisal documentation to support basis discussions—without assuming every inheritance results in an upward adjustment.
A step-up basis appraisal documents the value of inherited commercial real estate as of the date the basis is established—typically the date of death or an alternate valuation date. It is an appraisal assignment, and the value conclusion reflects market conditions as of that date. The deliverable is an appraisal report that the heirs and their tax advisor can use to support the basis reported.
We do not determine tax basis, and we do not assume that every inheritance results in an upward basis adjustment. Whether a "step-up" applies, and to what extent, depends on the specific tax situation and rules—which the heirs' tax advisor confirms. Our role is an independent, defensible valuation as of the required date; we do not provide tax advice or promise a particular tax outcome.
When Clients Need This Service
Heirs, executors, and their tax advisors request a step-up basis appraisal when inherited commercial real estate needs a defensible value as of the date the basis is established. This supports the basis the heirs report, which affects future depreciation and any later sale.
For example, when an owner of a commercial building passes away, the heirs may need the property's value as of the date of death to establish their basis. A supported appraisal gives the tax advisor a credible figure to work from, rather than relying on an estimate. We coordinate with the advisor on the required date and value definition.
What the Analysis Considers
The factors relevant to this assignment vary with the property and the question being asked. Depending on the agreed scope, the analysis may consider:
- The effective date—date of death or the alternate valuation date, per the tax advisor
- The applicable definition of value, confirmed with the tax advisor
- Market conditions, comparable sales, and rentals as of the effective date
- The property's condition, tenancy, and leases in effect at that date
- Any partial interests or ownership structures relevant to the basis
- Historical records and evidence from the period around the effective date
- Assignment limitations from the passage of time and available records
Not every assignment applies all three valuation approaches. The approaches used depend on the property type, available data, and the assignment's intended use.
Documents & Information That May Help
Providing the following can streamline an assignment, but not every item is required to begin. We can discuss what is available during the initial call.
The date of death or alternate valuation date
From the tax advisor
Property address and ownership documents
Leases and rent roll in effect at the effective date
Historical operating statements around that date
Any prior appraisals or assessments
How the Engagement Works
Every engagement begins with a conversation so the scope, fee, and timing fit the property and the question you need answered. A typical engagement moves through these stages:
Initial discussion
We confirm the property, the effective date, and the value definition the advisor requires.
Scope confirmation
We agree on the definition of value, report format, fee, and timing in writing.
Information collection
We gather leases, financials, and records from around the effective date.
Retrospective research
We reconstruct market evidence as of the date the basis is established.
Analysis & delivery
We conclude value as of that date and deliver the report for the advisor's use.
Scope, fees, and timing depend on the property type, assignment complexity, and the report format the client or intended user requires. We confirm these in writing before work begins.
Frequently Asked Questions
Common questions about this service.
Request Your
Free Appraisal Quote
Tell us about your property and what you need the valuation to address. To help us respond quickly, please include the property address, property type, assignment purpose, the relevant valuation date, and your requested completion date.
Gold Rush Appraisal provides commercial real estate valuations across the Atlanta metro area. Call us directly or send the details through the form and we'll get back to you promptly.
404-882-7881