When Are Vineyard Appraisals in Napa County, CA Necessary?November 4, 2016 9:48 pm Leave your thoughts
Vineyard appraisals are one of our specialties. They are often a part of winery appraisals where the facilities for making wine are evaluated. Sometimes, they stand alone if you only own the vineyard but sell the grapes to an independent, off-site winery. No matter your situation, there are circumstances where you need a fair market value of your vineyard. Here are the most common situations calling for vineyard appraisals in Napa County, CA:
- Land sales: Sellers should get an appraisal before listing their vineyard. This assures that they list a fair price and avoid underselling their property. Potential buyers should also consider getting their own appraisal of a vineyard. This helps with negotiation, and if the appraisal reveals any shortcomings, the purchase price can be adjusted accordingly. Appraisals basically assure a transaction where the parties enter into a deal fully informed.
- Insurance purposes: If you are seeking coverage for your vineyard, your insurance company likely wants an appraisal of not only your equipment for making wine, but also the value of the vines and land. This will determine the coverage levels and your premium. It is unlikely that you will secure insurance without an appraisal indicating fair market value.
- Partnership dissolution: Your winery may have started out as a partnership, but later, the relationship goes sour or one partner decides on a different path. Most partnerships require that the other partners buy out the interest of the departing partner. The appraisal determines that amount so the winery and vineyard can continue operating with the remaining partner or partners. Likewise, if your operation adds a partner, the appraisal will determine the amount required to purchase that partnership interest.
- Dissolution of marriage: California community property laws are complex in this area, but generally speaking, the end of a marriage requires an equal distribution of all marital assets. If the vineyard belonged to you before the marriage, there will be a lengthy process for determining whether your spouse gained an ownership interest in it after you were married. However, if you founded the vineyard together, one of you will have to buy out the other, much like in a business partnership. The only way to determine that value is to appraise the vineyard so you can move on to the settlement stage of this matter.
- Estate planning: Your vineyard is an asset that must be accounted for in your estate plans. Even if you have a designated heir who intends to continue your enterprise after you pass away, the value of the vineyard is still considered for tax purposes. In order to assure those taxes are not inflated, secure an appraisal while you draft your will or create trusts.
- Mortgage insurance removal: You may have purchased your vineyard when it was merely empty acreage. If that is the case, you may still be paying for mortgage insurance. Land that increases in value could be exempt from that. So, if you are looking for additional cost savings, arrange for an appraisal and see what you can do moving forward.
For winery and vineyard appraisals in Napa County, CA, call County Appraisals, Inc. to set up a consultation and schedule your appraisal.
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