Monday, July 23, 2012
Following up on my previous post, Estate Planning for Illegal Assets:
- New York Times, Art’s Sale Value? Zero. The Tax Bill? $29 Million:
What is the fair market value of an object that cannot be sold?
The question may sound like a Zen koan, but it is one that lawyers for the heirs of the New York art dealer Ileana Sonnabend and the IRS are set to debate when they meet in Washington next month. The object under discussion is Canyon, a masterwork of 20th-century art created by Robert Rauschenberg that Mrs. Sonnabend’s children inherited when she died in 2007.
Because the work, a sculptural combine, includes a stuffed bald eagle, a bird under federal protection, the heirs would be committing a felony if they ever tried to sell it. So their appraisers have valued the work at zero.
But the IRS takes a different view. It has appraised “Canyon” at $65 million and is demanding that the owners pay $29.2 million in taxes.
- Forbes: The IRS Art Advisory Panel Has Its Head In The Clouds, by Janet Novack