Following the example of collectors seeking tax breaks for their donation of art works to museums, artists themselves are seeking more equitable tax treatment for donating works.  While collectors currently can claim fair market value for the works they donate, artists themselves can only write off the cost of materials.  “It seems to me there is a discrepancy in treatment there”, says Philippe Vergne, director of MOCA. “What’s extraordinary is that artists keep giving.”  (more…)

Market Watch has an interesting article this week on the tax status of Nazi-looted paintings returned to their rightful owners, noting the tax-free status of reparations payments from the German government, particularly in the case of Maria Altman’s reception of the Gustav Klimt masterwork Portrait of Adele Bloch Bauer I, and attorney Randol Schoenberg’s move to get sales proceeds from the work equal status.   (more…)

Another article on the Obama Presidency’s attack on 1031 “Like-Kind” Exchanges is on Bloomberg this week, focusing on collector Steven Edlis and his use of the loophole to acquire works he then donates.  “Stefan Edlis has been generous but many people who will take advantage of this will not be generous,”says critic Robert Storr, dean of the Yale University School of Art. (more…)

The New York Times looks at the current practices of “Like-Kind Exchange” on the fine art market, a tax provision allowing collectors and art flippers to defer taxes on sales income by using proceeds to buy an even more expensive work, and the attention it’s currently receiving from tax regulators.  “If you are doing five transactions over 25 years,” says advisor Josh Baer, “each time buying something more expensive, each time you don’t pay the capital gains tax on the way. At the end of the day you are way ahead.” (more…)

A pair of bills introduced in Congress this week will look to improve artist rights and benefits regarding their works, The Art Newspaper reports.  One bill will look to push for an artist’s resale royalty in the US, bringing the country up to par with current measures being undertaken in Europe, while the second offers a tax deduction of fair market value for artists donating works to museums. Both bills have been proposed before, but have yet to be passed. (more…)

A number of New York City art galleries and dealers have been subpoenaed in the past weeks by the Manhattan district attorney’s office, asking for a sales and shipping records for past sales.  Some speculate that the high prices paid at recent auctions have triggered a response by the DA to investigate possible fraud and tax evasion.  “I suspect they are looking at many. It is very rare they would go after a one-off unless it was someone who was very well known,” says tax specialist Ken Zemsky. (more…)

The New York Times notes the attractive benefits for wealthy collectors founding their own private, tax-exempt museums to house their art collections, allowing the collectors to deduct full market value for their donations even when the museum may be housed on the same property as their home.  “I’m not against it being done, but it’s got to be done well,” says Robert Storr, dean of the Yale School of Art. “If there’s to be a public forgiveness for taxes there should be a clear public benefit, and it should not be entirely at the discretion of the person running the museum or foundation.” (more…)

The French Senate and parliament have passed a new bill this week cutting the nation’s  VAT rate on French artwork nearly in half, from 10% to 5.5%.  The bill, proposed by Socialist party member David Assouline, should have a major impact on the sale of French art, and targets what he considers “a ludicrous situation that penalizes the French scene and does not correspond to any economic logic.” (more…)

The New York Times has published an extended account of the recent ruling on the case regarding the inheritance of James A. Elkins, a collector whose works were held jointly by various members of his family.  The ruling, announced earlier this fall, allowed a discounted estate tax on these works, fundamentally changing the way taxes can be levied on art in a collector’s estate.  “I’ve had calls from estate planning attorneys that said they celebrated in the coffee room when this decision came out,” says Carsten Hoffmann, managing director at FMV Opinions. “This is a deal changer.”  (more…)

A trove of artworks valued at over $4.5 million has been discovered in Brazil, hidden away in shipping crates sent over from the United States.  The works, among them pieces by contemporary artists Os Gemeos and Sergio de Camargo were among the possessions of a Brazilian woman who authorities believe was seeking to avoid export taxes. (more…)

The New York Times has penned a new report on the ongoing disputes between MoCANoMI and the City of North Miami, with disagreements running all the way up to who is currently the director of the museum.  With both sides filing lawsuits over alleged injustices, and a potential move to Miami Beach being threatened by MoCANoMi, both sides are claiming control over the museum and its collection.  “It is as if a child is born and in turn says it is the mother of its mother,” says Babacar M’Bow, the man appointed as director by the city but disputed by the museum board. (more…)

The New York Times reports on a tax loophole regarding several states where art purchases can be awarded tax-free status if the newly gotten works are first lent to an art museum.  The tax loophole explains why Francis Bacon’s Three Studies of Lucian Freud, the most expensive work ever sold at auction, was first exhibited at the Portland Art Museum after its record-setting purchase last year.  “It is an amazing opportunity for these smaller cities to show these works,” says Mack McFarland of the Pacific Northwest College of Art. “But one does have to wonder, doing a cost-benefit analysis on a more global scale, whether or not the tax break for these wealthy collectors is worth it.” (more…)

The Ammersee home of German painter Georg Baselitz has been raided by German tax officials, who seized several crates of files as part of investigation into tax evasion.  The artist was implicated in tax dodging after his name appeared on a list of secret bank account holders with the Swiss bank UBS.  Baselitz had been quoted earlier this year as saying: “Despite all the taxes people pay, there supposedly isn’t any money in this country for art.” (more…)