Warmer weather may be on the way in many parts of the country—but business appraisers may be feeling the “chilling effect” of the Pension Protection Act (PPA) passed last year, in particular the penalty provisions of IRC§6695A. (See BVWire # 47-2). A recent Wall Street Journal (Feb. 27, 2007) article says the “host of questions” regarding what kind of tax (income, estate and gift, etc.) and what kind of practitioners (CPAs, appraisers, etc.) are subject to the PPA is causing appraisers to turn away or trim the scope of tax-related engagements, at least until the IRS issues clarifying regulations later this year. Another possible effect: “The cost of getting something appraised may well rise.”
ABA issues new comments. “It’s the uncertainty…that’s so troubling,” one attorney tells the WSJ. “Appraisers often have to rely on underlying opinions…where does liability begin and end?” For the latest comments and request to clarify §6695A by an American Bar Association (ABA) task force, sent last month to the IRS, click here.
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