From what I can find is IRS Publication 527, your scenario is not addressed. What it does say is that appraisal fees required by the lender as a condition of loan approval are included in the loan acquisition costs and amortized over the life of the loan. Other than that, I don't know if the IRS would question the "business need" for your appraisal. But you're not talking a whole lot there. I'd go ahead and claim it with the expectation that should my return be pulled for random audit, I may not be able to justify the deduction unless I can produce a disapproved loan application.
