Members of Ruchelman P.L.L.C. contribute to publications throughout the world and the Firm’s monthly tax journal, Insights.
Foreign persons owning artwork physically located in the U.S. must be mindful of special income, estate, and gift taxes associated with that ownership. In the second of a series, Rusudan Shervashidze and Nina Krauthamer look at issues such as use tax, which is the U.S. equivalent of a reverse charge of V.A.T., estate tax, and gift tax.
Read MoreTaxpayers holding valuable works of art receive different tax treatment, depending on the characterization of the individual. Is the individual the artist, a dealer, an investor, or a collector? Rusudan Shervashidze and Nina Krauthamer examine various planning tools available, focusing mostly on the collector.
Read MoreIn a recent case, the Tax Court was asked to evaluate two Old Masters paintings from the 17th century. Sotheby’s provided the valuation for estate tax purposes on a gratuitous basis. The appraised value totaled $600,000 for the two works. The estate retained the same auction house to sell one of the paintings. The sale price at auction was $2.1 million before buyer’s premium, and the auction took place within 34 months of the issuance of the appraisal report. Kenneth Lobo and Nina Krauthamer explain why the court had no difficulty finding that the estate’s expert was not independent and that the subsequent sale was relevant
Read MoreTaxpayers are usually taxed on net gains from the sale of property. However, tax may be deferred if the transaction is cast as an exchange and certain conditions are met. Art investors are now employing these methods to defer tax on gains from the sale of appreciated art by exchanging one piece of artwork for another. In this article, Nina Krauthamer and Sheryl Shah address the application of the like-kind exchange provisions under Code §1031, traditionally used for investment and business real estate, to the exchange of works of art.
Read More
