EquipNet, Inc.
MarketPlace  |   Auctions  |   Tech Solutions  |   Appraisals  |   My EquipNet  |   Services



Blog

February 28, 2012
by EquipNet News
Comments Off

Getting an Appraisal When Making a Gift or Donation

 According to the IRS tax code, a gift is any type of property that changes hands either with nothing given in return, or with payment that is less than the property\’s value. Gifts are subject to a gift tax, which is usually paid by the gift giver. The gift tax is one of the more complex pieces of tax law, so it is a good idea to speak with an accountant to see if your gifts are taxable or tax exempt. Some of the gifts that are exempt are gifts between spouses, gifts made to pay for educational expenses, and charitable gifts. There is also an allowable value of gifts you can give before you are required to pay a gift tax. If, after speaking to your accountant, you determine that your gift/donation is subject to the gift tax, you will need to hire an appraiser.

If you owe the IRS a gift tax, you must submit a copy of the appraisal report along with your tax return, in addition to the date of the exchange and the identity of the recipient. Ask your appraiser to give y ou the fair market value of the piece of property that you are gifting. The fair market value is the value of the property if it were sold by a willing seller and purchased by a willing buyer.

If you need a machinery or equipment appraisal performed before tax time, EquipNet can help. Check out our Asset Accuracy Resource Center for more information about appraisal and valuation services provided by EquipNet. For other tips about donating your pre-owned equipment, visit the Equipment Donations Resource Center.


Share:
Share on FacebookTweet about this on TwitterShare on LinkedInEmail to someoneGoogle+

February 23, 2012
by EquipNet News
Comments Off

An MRO Primer from EquipNet

If you look on the main page of the EquipNet website, you’ll see portals to buy and sell equipment, including spare MRO parts and MRO assets. In case you’re not familiar with the term, we thought we’d take a moment to help familiarize you with all things MRO.

MRO is an abbreviation of the phrase “maintenance, repair, and operations” (or sometimes “maintenance, repair, and overhaul”) and involves the repair of any type of mechanical, plumbing, or electrical device that is out of order or broken. It also includes performing routine and preventive maintenance on such devices.

MRO operations have two distinct categories. In the first type, the product remains the property of the customer, i.e., a service is being offered, which represents a closed-loop supply chain and usually has the scope of maintenance, repair, or overhaul of the product. The second type is an open-loop supply chain and is typified by refurbishment and re-manufacture or whether the product is bought by the reprocessing organization and sold to any customer wishing to make the purchase.

So that’s MRO in a nutshell, but what are we at EquipNet talking about specifically? When we discuss MRO, it’s in the context of MRO goods. MRO goods are any materials used in the creation of a product but not in the final product itself. Examples include:

  • the machinery used to make a product
  • spare parts for the machinery that creates the product
  • items used to maintain the facility in which the product is made

As a reminder, with our acquisition of Present Value LLC, a worldwide appraisal and advisory company, EquipNet now possesses expanded Certified Machinery and Equipment (CMEA) capabilities. For more information, please contact us today!


Share:
Share on FacebookTweet about this on TwitterShare on LinkedInEmail to someoneGoogle+

February 22, 2012
by EquipNet News
Comments Off

Determining the Value of Rare or Custom Machinery or Equipment

When determining the value of a farm tractor, restaurant equipment, or something that is considered an out-of-the-box piece of equipment, an appraiser will look at various factors to determine value, including its original price, wear and tear, depreciation, and current market value. It is a relatively straightforward process because there are usually numerous comparable pieces of equipment, which can help determine fair market value. However, it is much more difficult to determine the value of custom-made equipment such as custom-made dies, molds, and machinery, or something that is extremely rare, like a liftboat, of which there are only a handful in the world.

In the case of rare or custom machinery and equipment, an appraiser must take into account that such equipment may be one of a kind, which makes it more difficult to value because there are no other pieces against which to compare it. A whole host of considerations must be taken into account, including the original cost of its production, the value of its usage, replacement costs, depreciation, salvage value, and scrap value. The appraisal of custom equipment requires the specialized skills of a professional who has the expertise and certification to examine all of these factors and more to determine its true fair market value.

It is important to know the true market value of your machinery and equipment for a whole host of reasons, including for insurance purposes, when seeking funding, or when conducting a business valuation. Whether you need to know the fair market value or other standards of value such as liquidation value, salvage value, or replacement cost, it makes good financial sense to obtain a credible certified equipment appraisal report that will hold up under scrutiny with financial institutions, government agencies, buyers, sellers, shareholders, or partners.

Make sure you know what it’s all worth. Check out EquipNet’s  Asset Accuracy Resource Center for more information about appraisal and valuation services provided by EquipNet.      


Share:
Share on FacebookTweet about this on TwitterShare on LinkedInEmail to someoneGoogle+

February 17, 2012
by EquipNet News
Comments Off

Machinery and Equipment Appraisals in Business Valuations

A business valuation is useful for a business of any size – and not just if the owner is interested in selling. Rather, a valuation is an important planning tool that can provide a business owner with a snapshot of the company’s performance. This ca

n help the owner develop business performance improvement goals, make crucial decisions like whether to go public or add shareholders, and ultimately, plan for a graceful exit from the business. In order for a valuation to be helpful in these situations, however, it must be accurate.

As we wrote in last week’s post, titled “Machinery and Equipment Appraisals in Buy/Sell Agreements,” a company’s value is based on many factors and if any one of them is valued improperly, the entire valuation will be inaccurate. For example, there are several ways to measure the value of the company’s machinery and equipment: book value, fair market value, and liquidation value. Unless a business is in a liquidation situation, there’s no reason to use this valuation method when determining the value of a business. The book value of a piece of equipment is determined by a depreciation schedule, but doesn’t necessarily provide an accurate picture of how that piece of equipment would do on the open market, which fair market value does. Using book value of machinery and equipment rather than fair market value in a business valuation can skew the results and open a business owner up to the liability that comes with making crucial business decisions with inaccurate information.

Software and instructions for determining your company’s value yourself are easy to find, but they’re no match for the expertise of a certified appraiser. A certified appraiser can help you avoid pitfalls like using an incorrect valuation method and will ensure that the information you use to make your business decisions is accurate. Check out The Asset Accuracy Resource Center for more information about appraisal and valuation services provided by EquipNet.


Share:
Share on FacebookTweet about this on TwitterShare on LinkedInEmail to someoneGoogle+