The IRS, Value of Art, and A Catch-22...

J

JakeStratham

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The IRS has very few friends on this forum, so I thought you'd enjoy a chuckle at their expense.

Here's the story in a nutshell...

Ileana Sonnabend, a New York art dealer, passed away in 2007. Her heirs inherited a piece of art by Robert Rauschenberg titled "Canyon"...


RauschenbergCanyon2009534.ashx



Folks who inherit valuable art usually get slammed with a hefty tax bill, courtesy of the IRS. Here, the IRS stepped in for their cut, and said "Canyon" is valued at $65 million. Given that valuation, Sonnabend's heirs needed to cough up $29.2 million in taxes.

Sonnabend's heirs countered that the artwork "ain't worth shit."* Why? Because the thing has a stuffed bald eagle in it. According to federal law, you can't sell a dead bald eagle without committing a felony. If they can't sell "Canyon" to anyone, it's not worth anything.

The IRS, true to their nature, disagreed and started lopping on penalties. The heirs' bill now stands at $40.9 million. Classy.

The IRS has an Art Advisory Panel specially suited to appraise art. They're experts in matters such as these. True pros. Stephanie Barron, a member of the panel, had the following to say:

"The ruling about the eagle is not something the Art Advisory Panel considered," Ms. Barron said, adding that the work's value is defined by its artistic worth. "It's a stunning work of art and we all just cringed at the idea of saying that this had zero value. It just didn’t make any sense."
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Also from the piece:

So how did the panel arrive at the $65 million figure? Ms. Barron said, "When you come up with a valuation you look at comparable works and what they have sold for at public or private sales."
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Except Sonnabend's heirs can't sell "Canyon." Not without risking becoming felons.


Source: New York Times.


* Note from editor: this is a paraphrase of the actual quote.
 


How do you even pay the tax if it's a physical thing and not money that's being passed on?
 
Stupid, greedy bitch. This is why you start divesting yourself of shit like this (and cashola too) to your children or grandchildren and other heirs when you get to a certain age "off the books" and keep it out of your fucking estate and will.

She prolly couldn't BEAR to part with it, hence the drama with the gestapo.

Stupid, greedy bitch. Or maybe just stupid, I dunno. Lesson here for us all...

Write this down:

You AIN'T TAKING IT WITH YOU. Generation skipping is yer friend.
 
Artists are crazy like that, my aunt is crazy. She could have sold several of her paintings for $30,000 or more but she "can't bear to part with them".
 
I'm a reasonably established collector and this story had understandably been discussed at length. The IRS in this case is going beyond their normal stupidity. 2 major auction houses have caked the work at 0.00 and the fact that the IRS has been so confrontational on the matter has really astounded me. The people clearly are willing to pay the bill but reasonably see the piece as valueless and have no ability to even compensate the bill by selling the remainder of the collection. They should just allow the family to donate it to the national gallery and end the issue.
 
I'm pretty certain that this could be handled in court. Goes to show how fucking greedy the government is.

Why would they have to pay tax on it now? They didn't sell it yet, they haven't financially gained from it yet. Why is the IRS already adding on interest for something that has not yet become a financial gain, I'd imagine they already taxed the guy when he purchased it. Let me guess they collect that cool $29m now then when they sell it another $29m? Makes total sense to me * sarcasm *. I agree with the statement about how this logic follows in line with that which women use.
 
The IRS is theft.. Buncha zionist bastards taking money they don't rightfully earn to spend on foreign wars, policies and fucked up domestic things which don't benefit our people at all. Don't pay this shit.
 
IRS and the Federal Reserve bank.... can't quite decide which one I dislike the most..
 
dreamache said:
little mad?

how about instead, fuck the "gestapo", if they ceased to exist, it wouldn't be a problem.
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Focus less on the rhetoric and more on the message, brah ;-)

And the Gestapo will ALWAYS be there, unless you can figure out how to take control and do things better.

Good luck with that...
 
If it was me, I would ask IRS to buy the art for that said valuation, deduct the taxes and just send me a check for the balance 35.8 million. Also I would like to pass them the Dead Eagle seller's liability, since they are the guvment
 
Instrumentalist said:
The thing you didn't mention was that the heirs inherited about $1B worth of artwork, owed $471M in taxes, and has already sold off $600M of the collection.
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Wtf does that have to do with the fact that they shouldn't owe a dime on that piece, exactly? What, they have an extra 29mil lying there, so why not give it to Uncle?
 
Couldn't they just sell some random crap painting at say, 65 million, and then have the sales contract state that they are being gifted the other piece of work?

Obviously I'm clueless at this crap.
 
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