If you’re looking to donate a piece of art or wondering how your artwork’s value has changed since the recession there are two steps to follow.
If they have an appraisal done on that work
because often there are peoples who don’t know the difference between retail replacement value which is what they might have paid for that work of art at a gallery and fair market value which is what the IRS recognizes as the donation value and that is more what the person might expect to get if they were to sell the work at auction.
If they know where they want to donate something
because if they want the full fair market value of the work of art, they must donate it to an organization that fulfills the related use requirement. This means that they have a use for that work of art that is in keeping with what their organization does.
How To Value Art?
Appraisers are trained to value art by examining several items. It’s a process that can take anywhere from one week to six months. The IRS mandates that appraisers valuing art for donation purposes get billed on an hourly basis.
The first thing that appraisers do is look at the wall power of the piece or a painting. They say how much impact it had when you first look at it.
The second thing they do is take a look at the back. So they lift the artwork and look to see what’s on the back. They might have lots of clues, sorts of labels from different exhibitions, and different dealers that tell them what’s happened to the picture in the past. So they look and note down via different labels. They also see if there’s a stenciled number which means that the artwork went through auction at one point in the past.
They also look at the work itself. Appraisers look for a signature, whether the surface is smooth or not, are there any cracks in it? Is it in good condition? They look at the density of the color, has it been over-cleaned?
How to find an actual numeric value of art?
What they do is compare the work that they have just examined to others that are similar in the market. If they’re looking for a donation, they’re going to look at the auction market because appraisers need a fair market value. If they’re looking for insurance purposes they’re going to look at the comparables in the retail market.