Last updated on July 6th, 2023 at 10:02 pm
The art business is not as regulated as many other industries. Anyone can call themselves an artist or art dealer and put whatever price they wish on a piece of art. One dealer might price a piece of art at $2,000 while another dealer prices it at $40,000.
A professional appraisal gives you information from a respected third-party professional. It helps you determine the fark market value of your art.
With an appraisal document in hand, you are much less likely to make significant mistakes when buying, selling, or insuring your art.
Art Appraisal for Sellers
Let’s say you inherited a work of art and want to sell it. If you don’t know the current value of the piece, you can easily end up selling it for an amount far below the actual price. You might have no idea how much you lost!
Selling art for below value means you are left in a worse financial position. The person you sold the art to might turn around and sell it to someone else for a large profit. Worst of all, you won’t have many resources available to recover your losses.
Art Appraisal for Buyers
On the other hand, let’s say you plan to buy a work of art. The dealer is selling it for a large amount of money. As an art connoisseur who has spent some time learning about the art world, you think the value is a bit high but fair. After all, other works from the same movement and time period that have been been sold for similar prices.
Unfortunately, there are many more factors that go into art prices. If you aren’t a professional art appraiser with a deep understanding of all these factors, you may end up overpaying for the art several times over! You will likely never get that money back, even if you try to sell the art.
Appraisal for Insurance or Taxes
Art insurance companies often require appraisals before they will insure a work of art. These companies trust an outside expert’s opinion much more than the opinion of the owner.
Insurance companies are highly motivated to avoid overvaluating your art. They don’t want to have to pay you a larger sum than they have to if the art gets damaged or lost. Even if your insurance company doesn’t require an appraisal, it’s a good idea to get one to make sure the company will fully insure your art.
If you have inherited a work of art, you may need to get it professionally appraised for estate tax purposes. The government will want an accurate valuation of your art to make sure you are paying all the taxes you owe on the transferred property.
Art Appraisal for Donation
If you plan to donate a piece of art and get a tax deduction, you should get the art appraised. The appraisal will give you evidence that protects you if you are audited.
Even if you don’t care about getting tax benefits, you may still need an appraisal for the donation receiver’s sake. Nonprofits that accept art donations often require appraisals for their records.
Get Your Art Appraised Today
If you want to sell your art, a professional appraisal can help you make sure the price is fair. While art appraisal costs money, it’s worth it to make sure you don’t get ripped off during a transaction.