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Cash back credit card offers are all the rage, but how much do you really know about them? How do they give you money back and how often? Is a cash back credit card right for you?

Most cash back credit cards carry no annual fee and are accepted by merchants all over the world. Not to mention that you are able to earn a cash back rebate on virtually every purchase or cash advance you make with your cash back credit card. However, you may need to review cash back credit cards so that you are able to find which one is the best when it comes to actually how the customer is paid back. There are some ways in which you can find out which credit card is the best cash back credit card for you and your lifestyle. The first step that you will need to take is to look over the credit cards terms and conditions. You can usually find these on the cash back credit cards website. These are the fine print details that will allow you to determine whether or not the credit card is the right one for you and whether or not it really is indeed one of the best cash back credit cards at all. Please make sure that you know what you are signing up for, I have made the mistake of not looking at the fine print and I have ended up in some really uncomfortable places due to the fees that the credit card company listed in the fine print. Everything you need to know about a credit card company and its cash back credit card is in the fine print. The method in which your cash back is received differs between credit card companies. Ways that cash back credit cards usually give you money back are listed below:

1) Gift cards
2) Statement credits
3) Checks
4) Deposits into a special account just for you

No particular way is better than the other, however it is all up to which one appeals the most to you and is the most useful to you. A statement credit would lower your debt; however it is not like having the cash in your hand. You figure that you spend the money you should get some in return, right? If you chose to get cash back in a check, the check is normally issued at the end of the month.

What it all basically boils down to is what appeals the most to you. When you are deciding which cash back credit card you are going to use then you will have to pick one according to the services that you expect. If you want the cash back to go to the balance on your credit card that is fine, that will help you to lower the debt that you owe. If you want the cash back to come to you in a check then you can get it direct deposited into your bank account or either you can get a check in the mail. It all depends on how long you want to wait. Check out everything about what makes the best cash back credit cards before you sign on the dotted line.

It doesn’t really matter which one you go with when it comes to your cash back credit cards because the best cash back credit cards offer you a wide selection of options and they are all fantastic just make sure that you know what you are getting yourself into.
For more on cash back credit card offers, Robert Alan recommends that you visit CreditCardAssist.com

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Do you need cash to build or improve your home?

You’re probably thinking of mortgage, but, what if you can’t afford a mortgage? With all those monthly payments, and interest rates, it’s fairly hard to understand and even very hard to apply for one. Mortgage can be very risky even if it has low interest rate. You also need to meet a deadline to pay the mortgage to avoid penalty fees and also avoid the property to be foreclosed by the financial institution you applied for.

One such way to own a home without investing money is through home grants. There are private organizations that funds housing grants and there are also government sectors that have home grants. Government home grants usually have low interest and sometime no interest loans that can help you if you have financial problems.

Some grants are free for qualified individuals. If you are qualified for a free grant, you will never have to pay it back. It can usually be available for Native American Indians, family members of veterans, for veterans, low income families, first time home buyers, researchers, the disables, homeless people, teachers and more.

If you are a member of one of these groups then you are eligible for a housing grant from the government.

If you are a member of the military, the government will usually provide you with free housing grant as part of your benefit. It is very convenient for you and your family because you will be having housing funds provided by the government. And, the good thing about this is that it’s free. This means that you’ll never have to repay the government for the housing grant they provided you.

You can also qualify if you are a family member of a veteran, usually in the first degree. This means that if you are a child of a retired military or a veteran, you can also qualify for the government’s free housing grant.

Another person who can qualify for a home grants are persons who are disabled. The government will provide housing grant for disabled people. If you are disabled physically, all you have to do is ask the government for housing grants. They will usually give it to you.

Native American Indians also qualifies for housing grants. They are even given by the government reservations for tribes. Being a member of a particular Native American Indian tribe will give you housing grants from the government.

However, not only governments provide housing grants, private organizations do too. There are a lot of private organizations that both operate nationally and internationally to benefit homeless people, especially in third world countries. They are usually non profit organizations that travel around the world, particularly in impoverished countries to give families home grants from their organization. The members of these kinds of organization usually works for charity and will not ask any money in return.

The good thing about private organization home grants is that it’s usually fast and requires no papers or anything to qualify for the home grant. They will just look at the situation, seek local community approval and start building homes for impoverished people for free.

Home grants are a great way to get a home even if you have financial troubles. You can just ask your government for it or inquire in private organizations for the home grant requirement.

Some home grants can even provide you money if you need to pay off your mortgage or you need home improvement. Keep in mind that not everyone is qualified for the home grant. You should be able to qualify in their standards in order to qualify for a home grant.
S. Stammberger is the editor of Grants Central. Find out all you need to know grants, financial aids, and scholarships.

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If you have decided to begin a career in real estate investing, you will need to start out with the basics before you begin investing your money. The fact is that understanding the fundamentals of real estate investing is crucial for you to become a success. The following information will help you to understand what you need to do to become successful.

Why You Want To Invest

Generally speaking, there are only three reasons to invest in property. The first is to get cash immediately. This can be done a couple of different ways. This is done by purchasing a property at a low price then selling immediately at a higher price, otherwise called flipping properties.

The second reason to get involved in real estate investing is to get cash monthly. This can be done by generating a positive cash flow from the rentals you’ve purchased as an investment. Of course, the third reason is to get cash at a later date.

These properties are kept for a time until they appreciate in value and then they are sold. It is kind of like having cash in the bank that you can not touch. Understanding why you want to invest in property is one of the fundamentals of real estate investing that you must know before you begin the process.

The Buying and Selling Process

In order to be successful in your investing, you must first understand how the buying and selling process works. You need to understand what steps to go through before you close on a property. This includes learning about the purchases and sale agreement, contingencies, cash flow statement, and, of course, how to negotiate as both a buyer and a seller. These things are the fundamentals of real estate investing and must be understood before you begin.

Understand The Market

Understanding how to research the real estate market is also the key to your success. Knowing where to go, such as the local registry of deeds and town office, to research the history of the property can make or break you in this business.

If you do not have the history of the property, as well as information on how properties are selling in your particular area, you may find that you are lacking the fundamentals of real estate investing and find yourself on the losing end.

Your Financing Options

One of the most important things to learn is what your financing options are when investing in property. If you plan to finance your property investments, you will need to understand the terms and conditions of your loan. Without this knowledge, you may end up not making as much money as you could with your investment.

When you set out to learn the fundamentals of real estate investing, you will find that there is no one particular “right way” to begin investing in property. There are many different methods to use and some will bring you success while others will cause you to lose money.

However, if you can learn the fundamentals of real estate investing, you will find that you are successful with your investments far more often than not. You will find there are many property classes on the buying and selling process, financing, and negotiating online, as well as held by local financial institutions. Take advantage of the classes around you and you might be surprised in your success.
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When trying to plan life goals it’s often difficult to see where the road eventually leads to as it seems so far away. This article takes a look at a way of helping to deal with this often-encountered problem and overcoming it.

I find that it often helps to create a mental image - in terms I can relate to - of any given problem. So for really big projects it pays to have a big image! One I use for visualising life goals is that of a mountain. You are stood there at the foot of the mountain looking at the summit: how do you get there?

It’s tempting to think that you can just set off and, by sheer determination and single-mindedness, reach the top all by yourself. This may be true but for every thousand that set off this way perhaps only one will reach the top. How then do you get there? Well, firstly ask yourself this - just exactly how do you go about climbing a really big mountain?

Let’s think about it. Maybe you have seen documentaries on the subject, maybe not. However, if you think about it, there’s really only one way it can be done: in stages. That’s right - base camp one, base camp two and so on until you are ready to go for the top.

How does this relate to long-term goals? Simply put, it is much easier to break a journey - or a planned life goal - into planned sections rather than take the whole thing at one go. Also, if only one goal is set - in our mountaineering model the summit - then it is impossible to assess how the rest of the journey is progressing.

With only this single goal in sight, two main problems generally occur. The first is that, due to the long time scale - maybe twenty or thirty years in some cases - the goal becomes lost, or changed beyond recognition, or simply forgotten about in the general day-to-day bustle of living. The second is that, with no milestones along the way. the long-term goal can continually shift or become warped or fizzle out due to lack of any measurable achievements.

Thus the setting of intermediate goals is crucial - not only to mountain-climbing success but also to the achievement and realisation of any long-term objective. In any project I undertake I always set short-, medium- and long-term goals. Not only does this let me know how the project is going generally but it also lets me know that I’m on track with my current goal.

Now I wouldn’t blame you for thinking that this way of life is restrictive and maybe even obsessive. I wouldn’t blame you if you thought you couldn’t understand how anyone could live their life with a continuous line of goals stretching away from them into the future. However, I would blame you if, by not learning the simple - and it is simple - process of structured goal-setting you let your potential slip away from you!

It isn’t restrictive - goals can be changed or adapted within the overstructure of your long-term plans. There is nothing wrong with changing your interim goals - as long as YOU change them - not the other way round. Maybe there’s a better way up the mountain than you first thought!

Any goal in life should be have two criteria that are important to recognise. The first is that the goal - maybe the overall life goal or any of the interim goals - is achievable. If it isn’t - and only you can decide if it is or not - then it’s pointless setting it. It will only frustrate and demoralise you. On the other hand, it can’t be too easy either! However, goals that are too easy are preferable to impossible ones - the too-easy goal will soon be identified and you can then toughen it up some!

The second is that the goal should be measurable. How does it move your overall plan forward? How much money has it made you - and is it enough? Has it come in on time - or on budget? If you can’t answer these types of question by assessing your goal then you haven’t got it right and the effectiveness of your goal is reduced.

To summarise this short article, try to remember the following: don’t set a long-term goal without breaking the project down into several measurable, achievable goals; it is much easier to break the project down into chunks you can handle. Do set goals for any enterprise that you consider at all worthwhile and this will soon become habit. Maybe it’s not the coolest habit you could imagine having but, when you stand at the top of your personal mountain it could well seem the most valuable!
Steve Dempster spends his time working towards his life goal and having fun as well. If you would like to look at one way of starting off down a planned path to success, pay him a visit by clicking here

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Residents living in London are the most eager to get on to the property ladder, the release of new figures has indicated.

In research carried out by mform, just over a third (35 per cent) of adults living in the capital are looking to take out a mortgage within the next three years. However, with the city reported to carry some of most expensive property prices in the country, findings by the online mortgage provider indicated that some 11 per cent are aiming on taking out a secured loan worth more than quadruple the amount of their yearly salary - the highest proportion of such borrowers noted in the country. The study also revealed that four per cent of Londoners are happy to borrow at five-times their annual income. Overall, an estimated 13.89 million people across the country are said to have their sights set on getting a mortgage by 2010.

Meanwhile, the survey showed a willingness among those in the north-east of England to advance on the property ladder. With 32 per cent intending to have a mortgage within three years’ time, people in the area were said to be behind only London in terms of a desire to purchase a home. According to the financial services firm, eight and six per cent of respondents in the area have planning to borrow at four and five times the amount of their yearly take-home pay respectively. The eastern area of England additionally was said to see a rise in mortgage activity over the next three years, as 31 per cent of people look to get on to the property ladder. The findings also indicated that the south-west (24 per cent) and the Yorkshire and Humberside regions (22 per cent) contain the lowest proportion of residents wanting to take out a mortgage by 2012, with only one out of a 100 in the northern region of the country aiming on borrowing at five-times their salary.

Commenting on the figures, Francis Ghiloni, marketing and business development director for mform, reported that the study highlights that prospective buyers could be putting themselves under an increasing amount of pressure to afford a home. He said: “The cost of servicing a mortgage has been rising steadily and this is set to continue as many people are forced to borrow more in the light of rising property prices. Between 2001-02 and 2005-06, the amount of money mortgage holders spent on their loans increased by around 44 per cent.”

At the beginning of this month, the Woolwich Mortgage Affordability survey, which was carried out by Barclays, revealed that a rising proportion of homeowner’ salaries goes towards making mortgage repayments. Findings from the firm revealed that the average property owner in their 20s is seeing secured loan payment responsibilities take up 32.4 per cent of their salaries. Although mortgage expenditure was reported to account for 20.1 per cent of income across consumers of all ages - this figure is the highest level recorded since 2002. Due to rising affordability pressures of property, the age of those getting on the first rung of the housing ladder was now reported to rise past the current average of 29.
Tom Dawson writes for Essentially Home Loans. Our visitors can apply online for secured personal loans and consolidation loans at the lowest interest rates.

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The power of positive thinking is not just a mantra for feel good gurus to chant. It really is a way that you can reach any goal that you set your mind to achieving. Goal setting can be hard for those who procrastinate, but having a real plan that you can act on, along with the power of positive thinking is a concrete way you can have the life that you think you deserve.

There are many people who don’t believe that positive thinking can help you attain goals. Even if you believe in positive thinking, you may not know how to use it to your best advantage. There are methods and techniques you can use in order to make positive thinking not only a regular way of life, but help you reach those goals you have set even quicker.

Have you ever stopped to think what positive thinking really means? It is more than just something to say when someone is feeling down and depressed. Positive thinking is a whole new way of thinking that has to involve the subconscious mind as well. Even if you tell yourself, you are thinking and acting positively, your subconscious mind will know if you are telling the truth. You need to really convince yourself of positive thinking, and include everything in your life. Not only will you reap benefits from your personal life and your career, but you will enjoy the health benefits of positive thinking as well.

Those who are suffering from debilitating diseases such as cancer and other life threatening conditions, enhance the quality of their lives and the time they have left with positive thinking. They have convinced their subconscious mind that they can stay well, and many people do. When you utilize positive thinking in your life, your blood pressure may drop and you may find that you engage in less stressful behaviors than you did before.

The law of attraction is said that when you do good things and have positive thinking, good things will come back to you. The same can be said of negativity. When you base your life thinking of the worst things that could happen, instead of the positive aspects of a situation, you are wasting valuable time that could be better spent living your life.

When you apply the principles of positive thinking to your life, you will be amazed at the things you can accomplish. It is said that if you picture something often enough it can come true. What many people do to convince their subconscious mind of something is setting up a wish or dream board. This is a board where you will put your goals down in actual pictures. If you want to own a boat, put pictures of the boat you want out with pictures of you and your family out enjoying the water. With Photoshop and other technological tools this can be easy. It can also be fun is a great way to begin your positive thinking routine.

Use this board as a reminder of what you are trying to achieve. Spend a few minutes a day, each and everyday, visualizing in your head you actually doing whatever it is you want to achieve. Look at the picture and tell your subconscious mind that you are doing it, and before you know it, you will actually be living the pictures in your subconscious mind that you have put up on your wish/dream board.

Filling your mind with negative thoughts never got anyone anywhere. When you put your mind to it and apply the principles of positive thinking, you can do anything. If you are going on a job interview, you tell yourself you will be an asset to the company, and you are more than qualified for the job, your subconscious mind will believe you and your confidence in yourself and your abilities will be more than apparent to prospective employers.

The same can be said about just about every area of your life. Instead of dwelling on disaster, fill your mind with the best that can happen. You may find yourself disappointed at first, but winners never give up. Those who succeed in this world in business and in their personal relationships are always using positive thinking. They truly believe in the law of attraction; good things will come to those who think they deserve it.
Stephen C Campbell (Master NLP Practitioner) has published more information on using the Subconscious as a Goal Setting tool at http://www.rightandwrongthinking.com/

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If you are finding your current vocation a bit dull and want a lift, or feel that you could do more in your current career, then perhaps you should look at getting a career development loan. Career development loans can help you to learn more about your career by helping to pay for your extra education. If you want to get ahead in your career and invest in learning, then here is some information to help you learn more about career development loans.

What are career development loans?

Career Development Loans, or CDLs, were launched back in 1988 and are part of a government program to help people further their education so that they can improve their skills within their chosen vocation. They are available for people who are employed, self-employed and unemployed, as long as they meet the criteria.

How do I apply?

Applying for a CDL is like applying for any other loan, in that you have to meet certain criteria in order to be accepted. If you are applying for a vocational course that lasts no longer than 2 years, or three years if part of the course is practical experience, then you could be eligible for a CDL. CDLs are available from a select few high street banks, and although you do not have to be a customer of theirs, you will probably need to open an account with them to receive the loan.

Deferred repayment

The main advantage of career development loans is that they are what are known as deferred loans. This is similar to a student loan, in that you only start making the repayments after the loan term has finished, which is generally just a little more than the length of the course you are taking. During the loan term, the Department for Education and Skills (DfES) pays the interest, and then once the loan finished you repay the loan using a fixed rate of interest. Although the rate can vary from lender to lender, they are generally lower than normal personal loans because they are part of a government initiative.

How much can I borrow?

In general you can borrow between 300 and 8,000, and the CDL can be used to pay up to 80% of course fees and 100% of associated expenses such as travel and materials. However, if you are unemployed the loan may be able to cover all of the fees for your course.

Investing in your future

CDLs are a great way to invest in your future career and give you the skills that you need to progress further. Although you have to pay the loan back with interest, you will not be paying anything during your course, and the money that you pay back should be countered by the extra wages you can earn with your new skills. However, as with any other loan you should make sure that it is right for you and that you will be able to make the repayments once you finish the course.
Peter Kenny is a writer for The Thrifty Scot, please visit us at Compare Loans and Personal Loans

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Everything that you are experiencing now is your brain’s perceptions of them, it may not be real. That is why hallucination is pretty much ‘visible’ to only that one guy. However, the hallucination or actual happenings have the same effect on your mind. In other words, your brain cannot tell the difference between something that had really happened or something that is make-believe. You can fool the brain by vividly imagining scenarios and the brain will believe it is true. This is also known as creative visualization. It is a vital step in the formation of our beliefs.

If you have ever skipped lunch, you will have probably experienced it too. Mental images of your favourite cheeseburger start to saturate your mind. You can see it now. As you grab the burger, you can feel the texture of the bun and the sweet meaty scent drifting into your nostrils. You take a long and slow bite, the cheese and patty goes so well together. You can feel the amount of saliva in the mouth now. If your visualization skill is that good, you will probably find yourself drooling.

Even though there is no burger, your mind can imagine one and still send signals to your body to start salivating. So how will this affect our beliefs?

Your beliefs are never absolutely true, they are merely generalizations and ill-conceived notions. Just like the burger, they are never real, they are just fractions of the real things and subjected to third party influences. If you can remember the beliefs analogy I gave, those evidences or truck parts, are contributed by other people or yourself and contain only a fraction of the truth, never complete. Your beliefs are a combination of feedback and generalizations from you and your environment.

Hence, you can also manipulate your beliefs to achieve peak performance, by using creative visualization techniques. In the simplest term, you can choose which truck parts to go with your ideal engine and optimise the truck’s functioning. You can construct your own belief and either let it work for you or hold you back. So how do you change or modify an existing belief?

Firstly, you must find enough reasons to change your current beliefs. This first step helps to build a strong emotional reason for change. Secondly, you have to challenge every piece of evidence that had supported the faulty idea, by proposing counter-evidence. Now that the truck is bare, you can easily replace the faulty engine with a new one. Thirdly, replace the old idea with a new and better one. Fourthly, support this new idea with evidence. You are now integrating the new and better truck apparels with the engine.

However, the work is not done yet. Fifthly, you must write this new belief down. Remember that no beliefs are completely true. Writing it down helps you to review your beliefs and facilitate future changes.

Always remember that your beliefs are reliant on your perceptions and they can be fooled. Use this fact to your advantage and create better and more empowering beliefs. If you realise that a current belief no longer serves you well, you can always change it simply by

(i) finding enough reasons to change
(ii) disproving the evidence supporting your old beliefs
(iii) putting forth a new idea
(iv) supporting it with relevant evidence and then
(v) writing it down.

Always be aware of your beliefs and remember that you have control over them.
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There are all kinds of reasons why you might fall behind in your mortgage payment - sickness, job loss, divorce, or a host of unforeseen circumstances that can have you facing foreclosure. You can stop home foreclosure by getting cash for your house.

There are two types of cash you can seek out to stop the foreclosure on your home. The first is in another form of financing that will bring you out of rears and back into good standing so that you are no longer facing foreclosure. The second is to sell your house quickly. A cash sale will pay out your mortgage and bring you out of foreclosure before it can actually happen.

If you aren’t able to make your mortgage payment call your lender immediately, explain the problem. I hope that your lender is wiling to work with you, but that’s not always the case. If you need to stop home foreclosure, you’d better get busy.

Today those facing foreclosure have a lot more options than just a few years ago. Today we have non-traditional loans, longer terms, adjustable rates, and even loans that allow you to finance 100% of the cost. The idea that you are about to lose your home to foreclosure is heart breaking. All that hard work to make it your own home, all that time to fix it up, and now you are faced with foreclosure, but you can stop home foreclosure. So what can you do?

You can get cash for your house if you have built up some equity. There are many lenders that will be happy to lend you the equity that you have built in your home. You can contact local lending institutions or have a look on line. What you are really looking for is mortgage lenders that think outside the box in their methodology for financing.

There are plenty of investors out there who are willing to do high-risk foreclosure financing so make sure you check out all your options. You may be able to pull a secondary mortgage, or you may be able to refinance your entire home and quite possibly come out with lower payments.

With that said you need to be aware of scam artists that are called predatory lenders offering loans that are at an interest rate that is far too high, have exorbitant brokerage fees, or repayment terms which are simply unaffordable. Which means you will land up in foreclosure again in no time at all.

Your second option is to sell for cash and then paying out your mortgage. Selling your house as a pre-foreclosure sends the message that you are serious and that your house is priced right. In fact, there are sites that list nothing but pre-foreclosures and investors that make a habit of stopping by to see what’s for sale on the pre-foreclosure front.

What’s important to remember when you are forced with a foreclosure is that you have options. You can stop home foreclosure by getting cash for your house. Whether you want to find cash and remain in the house or find cash and sell the house is also up to you. If you are facing foreclosure it’s important to take care of your family.
Terry Fitzroy has been buying homes since 1987. He is a professional ugly home buyer, and buys homes fast.

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This article examines the impact on taxpayers and appraisers as well as their advisors of the new Federal provisions of the Pension Protection Act. For appraisers performing valuations for federal tax purposes in accordance with the Pension Protection Act (PPA), signed into law in August 2006, stipulates new penalties and stiff sanctions if the appraisers or appraisals fail to meet the new qualifications.

New Appraiser Penalty

The new regulations have started to have a unsettling effect on the appraisers, primarily because it raises many questions, including what kind of tax (gift and estate tax, income tax, or both) is affected, and who may be hit by penalties.

Further, PPA added the new Section 6695A to the Internal Revenue Code. Section 6695A includes new penalties, which are pertinent to appraisers of property for income and transfer tax purposes.

New penalties are applicable to appraisals provided in connection with returns or claims for refunds filed after August 17, 2006. Penalties are applied when the appraised value of property deviates from the correct value by certain set percentages as follows:

“Substantial Misvaluation” (income tax environment): 150 percent or more off of actual value.
“Gross Misvaluation” (income or transfer tax environment): 200 percent or more off of actual value in an income tax case or 40 percent or less in a transfer tax case.

Appraiser penalty applies for appraisals prepared for returns or submissions filed after the date of enactment.

Amount of Penalty
Rather than the aiding and abetting penalty under section 6701 (generally limited to $1,000), appraisers are now subject to a penalty equal to over $1,000 or 10 percent of the underpayment attributable to the valuation misstatement, up to a maximum of 125 percent of the appraisal preparation fee (gross income) received by the appraiser.

Levying new penalties requires certain criteria to be fulfilled, including:

1. Appraiser must prepare an appraisal only in connection with a return or a claim for a refund.
2. Appraiser needs to know that the appraisal will be used for the above mentioned purpose.
3. Appraisal must result in a substantial valuation misstatement or gross valuation misstatement.

Misvaluation thresholds have been lowered, and also apply to estate and gift tax appraisals.

A substantial valuation misstatement arises if the value is 150 percent of the correct value. For example, if an income tax charitable deduction of $90,000 is claimed by a tax payee, based on an appraisal of a painting that the payee donates to a museum, and the correct value of the painting is later determined to be only $30,000, penalties would be enacted upon the appraiser section 6695A. In the case of estate or gift tax, a substantial misstatement occurs if the value exceeds the correct value by 65 percent or more. For example, if an appraiser applies a 45 percent discount for a going business with an underlying value of $100,000 for a value of $55,000. If the IRS and court determine that the discount should have only been 15 percent, the correct value would be $85,000. The appraised value is only 64.7 percent (i.e., less than 65 percent) of the “correct” value. As a result, a 20 percent substantial-understatement penalty would be levied on the appraiser’s fee.

A gross valuation misstatement occurs if the value exceeds the correct value by 200 percent or more. In the case of gift or estate tax, a gross valuation misstatement occurs if the value used is 40 percent or more of the correct value.

As penalties under section 6695A are far more severe than prior to PPA, appraisers may be more conservative and might be forced to choose to restructure or raise their fees; although as described above, the more gross income an appraiser derives from an appraisal, the larger the potential penalty. For example, an appraiser prepares an appraisal which he knows will be used to support an income tax deduction for a charitable contribution of the subject property. He charges $6,000 as the appraisal preparation fee. He values the property at $1 million, resulting in an income tax benefit from the deduction of $300,000. The correct value is $600,000, resulting in an income tax benefit from the deduction of $180,000. The appraiser is subject to penalty in this case as the claimed value of $1 million is more than 150 percent of the correct value of $600,000 (i.e., $900,000). According to PPA guidelines, appraiser’s penalty in this case is $7,500 (125 percent of the $6,000 fee), because this is less than 10 percent of the tax underpayment (10 percent of 120,000, or $12,000).

The new penalties imposed under section 6695A create a non-uniform field for appraisers engaged by taxpayers and appraisers engaged by the IRS. Taxpayer appraisers are likely to be under the scanner of PPA and face penalties if their appraisals are later rejected. On the other hand, IRS appraisers face no similar penalties no matter how far their appraisals are from the values finally determined for tax purposes.

The penalty will not apply if the appraiser establishes to the satisfaction of the IRS that the value established in the appraisal was more likely than not the proper value. However, given the magnitude of the trigger point percentages, it would be unlikely to prove a “more likely than not” standard when the magnitude of difference is 40 percent or 200 percent.

Prevention is better than cure. By adhering to norms and being organized and cautious about the whole process would ensure that you have nothing to fear. Educating yourself about the new law and its implications will further minimize your chances of getting in the way of PPA radar and getting penalized heavily.
Mel Abraham CPA, CVA, ABV, ASA, CSP - author & Adjunct Professor (USD Law School. Further, for access to an audio presentation on IRS penalties and the PPA visit http://www.valuationeducation.com/penalties.html. He can be reached at mel@melabraham.com.

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