(1)a person prepares an appraisal of the value of property and such person knows, or reasonably should have known, that the appraisal would be used in connection with a return or a claim for refund, and
(2)the claimed value of the property on a return or claim for refund which is based on such appraisal results in a substantial valuation misstatement under chapter 1 (within the meaning of section
6662(e)), a substantial estate or gift tax valuation understatement (within the meaning of section
6662(g)), or a gross valuation misstatement (within the meaning of section
6662(h)), with respect to such property,
then such person shall pay a penalty in the amount determined under subsection (b).
(b) Amount of penalty
The amount of the penalty imposed under subsection (a) on any person with respect to an appraisal shall be equal to the lesser of—
(1)the greater of—
(A)10 percent of the amount of the underpayment (as defined in section
6664(a)) attributable to the misstatement described in subsection (a)(2), or
(2)125 percent of the gross income received by the person described in subsection (a)(1) from the preparation of the appraisal.
No penalty shall be imposed under subsection (a) if the person establishes to the satisfaction of the Secretary that the value established in the appraisal was more likely than not the proper value.
Section 1219(b)(1) ofPub. L. 109–280, which directed the addition of section
6695A at the end of part I of subchapter B of chapter 68, without specifying the act to be amended, was executed by adding section
6695A at the end of part
I of subchapter
B of chapter
68 of this title, which consists of the Internal Revenue Code of 1986, to reflect the probable intent of Congress.
2007—Subsec. (a). Pub. L. 110–172, § 11(a)(40), designated the words “then such person shall pay a penalty in the amount determined under subsection (b).”, appearing in par. (2), as concluding provisions of subsec. (a).
Subsec. (a)(2). Pub. L. 110–172, § 3(e)(1), inserted “a substantial estate or gift tax valuation understatement (within the meaning of section
6662(g)),” before “or a gross valuation misstatement”.
Effective Date of 2007 Amendment
Amendment by section 3(e)(1) ofPub. L. 110–172effective as if included in the provisions of the Pension Protection Act of 2006, Pub. L. 109–280, to which such amendment relates, see section 3(j) ofPub. L. 110–172, set out as a note under section
170 of this title.
Section applicable to appraisals prepared with respect to returns or submissions filed after Aug. 17, 2006, with special rule for certain easements, see section 1219(e)(2), (3) ofPub. L. 109–280, set out as an Effective Date of 2006 Amendments note under section
170 of this title.
The table below lists the classification updates, since Jan. 3, 2012, for this section. Updates to a broader range of sections may be found at the update page for containing chapter, title, etc.
The most recent Classification Table update that we have noticed was Tuesday, August 13, 2013
An empty table indicates that we see no relevant changes listed in the classification tables. If you suspect that our system may be missing something, please double-check with the Office of the Law Revision Counsel.
Description of Change
Statutes at Large
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