Short answer: A date-of-death appraisal is an independent opinion of a property’s market value as of the day the owner died. In California, trustees, heirs and CPAs use it to set the new tax basis, support estate tax filings, divide property fairly and settle disputes. It is separate from the valuation a court-appointed probate referee prepares in a formal probate. Call (805) 990-9700 to talk to an appraiser about your property.
This article is general information, not legal or tax advice. Talk to your attorney or CPA about your situation.
What is a date-of-death appraisal?
A date-of-death appraisal answers one question: what was this property worth on the day the owner passed away? The appraiser looks back to that date and uses the sales, rents and market conditions that existed then, not today’s market.
Because the effective date is in the past, a date-of-death appraisal is a type of retrospective (retroactive) appraisal. That is normal. The appraiser can still inspect the property today and then account for any changes since the date of death, such as repairs, damage or new tenants.
When do you need a date-of-death appraisal in California?
The most common reasons we see:
- Stepped-up basis. Under federal tax rules, inherited property generally takes a new basis equal to its fair market value at death. A supported value can make a big difference when the property is later sold. Your CPA will tell you how it applies.
- Estate tax filings. Larger estates may need to file a federal estate tax return (Form 706), and the real estate values must be supported.
- Trust administration. Successor trustees often need values to divide assets among beneficiaries, fund sub-trusts or document their decisions.
- Equalizing shares. When one heir keeps a building and another takes cash, everyone needs a number they can trust.
- Disputes. When beneficiaries disagree, a well-supported narrative report gives attorneys a solid starting point.
- Property tax questions. A transfer at death can trigger reassessment by the county assessor, and the rules for parent-child transfers narrowed after Proposition 19 took effect in 2021. Ask your attorney or CPA how this affects your family.
Does a California probate referee replace a private appraisal?
Not always, and this is where many families get confused.
In a formal California probate, the court appoints a probate referee. The referee values the estate’s non-cash assets, including real property, for the Inventory and Appraisal filed with the court. In that setting, you generally do not hire a private appraiser to replace the referee’s value on the court inventory.
But many California estates never go through formal probate. Property held in a living trust usually passes outside of probate, so no referee is involved. In those cases, the trustee typically relies on a private date-of-death appraisal.
Even when there is a probate, families and their advisors still order private appraisals for reasons the court inventory may not cover, such as income tax basis planning, estate tax filings, disputes between heirs or a second opinion on a complex commercial property. The right answer depends on the estate, so confirm with your attorney.
What makes a good date-of-death appraisal?
For commercial property especially, a few things separate a report that holds up from one that does not:
- The correct effective date. The value must be as of the date of death (or an alternate valuation date if your CPA chooses one).
- Comparables from the right time. Sales and leases should reflect the market on that date, not today.
- A clear narrative. The report should show its research and reasoning so a CPA, an attorney or a reviewer can follow it.
- The right property rights and condition. Leases in place, deferred maintenance and occupancy on the date of death all matter.
- An appraiser you can reach. When the CPA or attorney has a question, they should be able to call the appraiser who wrote the report.
Does it matter if the property is commercial?
Yes. A single-family home and a multi-tenant retail center are very different assignments. Commercial date-of-death work often requires reviewing leases and rent rolls in effect on the date of death, reconstructing income and expenses, and analyzing cap rates from that period. Gas stations, vineyards, mixed-use buildings and land each bring their own questions.
PM Appraisal is a commercial appraisal firm first. Our team appraises any commercial property type anywhere in California, and we also appraise homes when they are part of the same estate or trust, so the family can work with one firm.
How long does a date-of-death appraisal take?
It depends on the property type, how far back the date of death is and how quickly records arrive. We offer rush commercial appraisals in 5 to 7 business days. Standard commercial reports typically take about 7 to 10 business days. Call (805) 990-9700 for a timeline on your property.
What should I have ready?
- The exact date of death
- The property address or addresses
- The purpose (trust administration, basis, Form 706, dispute)
- The name of the attorney or CPA on the estate, if any
- For income property: leases, rent roll and operating statements around the date of death
- Notes on any major changes since the date of death
Frequently Asked Questions
What is a date-of-death appraisal?
It is an independent opinion of a property's market value as of the date the owner died. It is commonly used for stepped-up basis, estate tax filings, trust administration and disputes.
Is a date-of-death appraisal the same as a probate referee's appraisal?
No. In a formal California probate, a court-appointed referee values real property for the court inventory. Private date-of-death appraisals are used for trusts, tax basis, estate tax filings and disputes. Your attorney can tell you which you need.
Can an appraisal be done years after the date of death?
Yes. A retrospective appraisal values the property as of a past date using market data from that time.
Do I need a date-of-death appraisal if the property is in a living trust?
Often, yes. Trust property usually passes outside probate, so trustees commonly rely on a private appraisal. Ask your attorney or CPA.
Do you appraise commercial property for estates anywhere in California?
Yes. PM Appraisal appraises commercial and related residential property for estates and trusts in every California county. Call (805) 990-9700.
Settling an estate or trust?
Attorneys, CPAs and trustees: call (805) 990-9700 to scope a date-of-death appraisal with the appraiser who will do the work.
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This article is general information, not legal or tax advice. Talk to your attorney or CPA about your situation.