Jul 23, 2019

Why Selecting Credentialed Appraisers Matters & What Qualifications to Ask About When Selecting an Appraiser

A recent tax court ruling reveals why it is important to hire a formally-trained, dedicated appraiser rather than an auction house specialist or dealer. For the article, see  https://procedurallytaxing.com/the-perils-of-a-discredited-appraisal-critical-insights-on-kollsman-v-commissioner/

The article also lists useful criteria for what to look for when selecting appraisers.

The Washington, DC-based Appraisal Foundation also weighed in supporting the court's ruling, stating:
“Consumers are the biggest beneficiaries of this ruling. Personal property assets will be better protected when a qualified and independent appraiser is retained to value one’s personal property assets,” said John Brenan, vice president of appraisal issues at The Appraisal Foundation. “This also means wealth managers and estate attorneys now have a greater fiduciary duty to their clients to fully understand appraiser qualification criteria and appraisal standards when vetting personal property appraisal experts.”

The ruling arises from the case of Estate of Kollsman vs. Commissioner. The Estate hired a premiere auction house to conduct an appraisal of the estate’s art collection. The U.S. Tax Court rejected the valuation of the auction house expert because of bias and a lack of objective evidence. The IRS retained the services of a personal property appraiser, who met the qualifications established by the AQB and completed an appraisal that was compliant with USPAP.

The IRS appraisal expert found two of the paintings were significantly undervalued. The court also found that the auction house expert had a conflict of interest as the appraiser in question also sought to represent the paintings at auction. The 9th Circuit Court took the case up on appeal and agreed with U.S. Tax Court opinion.

Jun 24, 2019

Why Documenting Your Collection Matters

The website wealthmanagement.com has published an interesting article that discusses why collectors should document their collections: The Importance of Documenting Clients' Art Collections. This is important to do no matter how small your collection. I work with heirs regularly who don't have a clue about the value of art and antiquities they have inherited and they also often get wrong advice when settling their loved-ones' estates. Even if the contents of an estate does not need to be appraised for IRS tax filing, it is always a good idea to get objects assessed so a basis in value can be established as of the person's date of death. That is because if the heirs sell it afterwards, they will have to pay capital gains taxes on the profit. If a basis for value is established as of the death date, then the taxable amount will be lower.

Jan 9, 2019

UK Ivory Ban Now in Effect

Similar to the restrictions on the sale of objects made of ivory in the US, the UK has also passed regulations restricting its trade. See an article on this in Apollo Magazine here 

Nov 21, 2018

The Value of Items You Inherit

In recent years, I've been getting more and more queries from people who have inherited mounds of things from family members who traveled to or resided in Asia decades ago, before, during, or soon after World War II. Only sometimes do these items have significant monetary value. In most cases though, their value is cultural and historic. Please don't throw out your stuff if it cannot be sold without first determining if it is worthy of being preserved in a library, archives, or museum collection somewhere.

How to Preserve and Organize Old Photos

The Washington Post has an article that is a good, simple guide to helping people preserve and organize all their old family photos. See it here.

Jul 30, 2018

CPAC – Building A Wall Against Art Part I: How the Executive Branch Controls US Access to Art and Artifacts

"The art world is dominated today by stories about spectacular multi-million dollar sales of contemporary artworks at shows and auction houses. Yet the market for ancient and ethnographic artworks has no such lofty expectations. There are far fewer important ancient artworks offered at auction in the US than just a decade ago, and there are fewer foreign exhibitors (or even American galleries) willing to show at major antique fairs in New York.

Already, US authorities’ aggressive seizures of artworks from long-held collections and the unprecedented number of prosecutions based upon foreign laws that nationalize virtually all antique artworks have made art dealers, collectors, and museums hyper-cautious. These enforcement actions threaten to end the once-dominant New York market in global antique and tribal art....Objects that can be proven to have been collected before 1970 are categorized as “good” for marketing, collecting and museum acquisition purposes. Objects without proof of collection date or collected post-1970 are “bad.”"
Quoted from this article, please read: Click here.

Trump Administration Proposed Tariffs on Chinese Art & Proposed Extension of Existing MOU.

The importing of Chinese art from China has been regulated since 2009 by a Memorandum of Understanding (MOU) that is set to be renewed soon, through 2024. It is my opinion, and that of many other experts and commercial & non-profit institutions in the U.S., that this ban is not appropriate. The ban covers virtually all items through the Tang Dynasty and wall decoration and monumental sculpture more than 250 years old.
See the discussion on why this MOU should not be renewed posted by Cultural Property News here.

In addition, "ordinarily, there are no customs duties on art or antiques. It is considered in the public interest to bring art and literature to the U.S., so in the past, no duties were imposed on foreign art or books. The Trump administration is changing that, at least for art and antiques from China. This is one of the more bizarre stories in the tariff saga, since a tariff on antiques will please the Chinese government and reinforce its global dominance and monopoly on Chinese art. Artworks, antiques, and historical and archaeological collections are included in the Trump administration’s proposed 10% retaliatory tariff on an additional $200 billion of China imports....it is clear that the proposed tariff on Chinese art only punishes U.S. collectors, dealers, and art museums – not the Chinese, who requested import restrictions on art and antiques up to 1912 in the first place!" (quoted from Cultural Property News July 19, 2018).
The article includes a link on how individuals can comment on these proposed tariffs, which must be received by August 17, 2018.