Skip to comments.Value: $0, Taxes: $40 Million
Posted on 07/24/2012 12:37:23 AM PDT by Altariel
This weeks winner of the you-cant-make-this-stuff-up contest is undoubtedly a front-page story in this mornings New York Times. When New York art dealer Ileana Sonnabend died in 2007, she left her children a fabulous collection of modern art valued at $1 billion. Her children have already paid $471 million in estate taxes on the collection, being forced to sell off most of it to meet the bill. (This is a beautiful example, by the way, of why estate taxes should be abolished and replaced with a capital gains tax on inherited assetsthe collection, an artistic whole in itself, had to be destroyed to pay the taxes due.)
But there is one item in the collection, a work by Robert Rauschenberg that cannot be sold. It contains a stuffed bald eagle and under the terms of the 1940 Bald and Golden Eagle Protection Act and the 1918 Migratory Bird Act, it is a felony to possess, sell, purchase, barter, transport, import or export any bald eagle alive or dead. The estate, advised by three experts, including one from Christies, therefore, valued the work at zero. The IRS decided it was worth $65 million, and is demanding $29.2 million in taxes and $11 million in penalties because the heirs inaccurately stated its value.
The trouble, of course, is that the heirs didnt inaccurately state its value. Anything that cannot, for whatever reason, be sold, is worth zero by economic definition. The value of anything is only what someone else is willing to pay for it. And to pay a dime for this particular artwork would be to commit a federal felony. To sell it for a dime would be to commit a federal felony.
The IRS has an Art Advisory Panel, that provides expert advice on the value of art works involved in estates. It was the panel that decided it was worth $65 million. Stephanie Barron, a member of the panel and an art curator at the Los Angeles County Museum of Art, said that, Its a stunning work of art and we all just cringed at the idea of saying that this had zero value. It just didnt make any sense.
It makes perfect sense and Ms. Barrons statement is a classic example of the fallacy of the just price, that things have inherent value independent of the marketplace. They may have artistic value, emotional value, religious value, etc. But if they cannot be sold then they have no monetary value because they cannot be converted into money.
The IRS Art Advisory Board, I assume, is made up of art experts. It should add an economist to give the other board members a lesson in economics 101 when necessary. And the IRS should have someone empowered to tell the Bureau, Are you crazy? This will make us look like idiots, and vindictive idiots at that.
I can’t wait till Ted Turner’s family has to settle that scumbag’s estate. Oh wait he probably already had his lawyers take care of that.
If I wanna bequeath anyone anything it will be in a buried mayo jar full of cash/valuables and the only thing I will pass on will be instructions on how to get to it...
Then they should deed it over to the IRS and request a ~~~$39 million refund for their overpayment.
This proves that the government cannot be responsible for economic growth, but can be responsible for economic destruction. By declaring a Bald Eagle or anyone’s asset or abilities or trades illegal, they can make you and I business-less and value-less.
This is sheer genocide without due process.
Since owning the damned thing is equally illegal, then the bequeathing was also null and void. It becomes ownerless and can’t be moved either. And certainly does not incur any tax liability.
It wouldn't be quite the same without the illegal eagle.
They got the "didn't make any sense" part right, on multiple levels.
I wonder if Ms Barron is as ugly as the work she so highly values?
Gack, it looks like something a third grade class might construct, except for the bird. Actually a dead canary would look better on it, I think.
I'll bet she is on the inside.
Government only hires the unemployable. It’s the second
tier of welfare. These buffoons on the Art Advisory Panel
are totally worthless in the private sector as with most
There is a point in a child's life when he discovers the wonders of glue.
"Look, the hamster died, right? We didn't kill it, it just died. So we could have buried it but then Joey got the idea to glue it to a piece of canvas, so it would be, like, art! Isn't that cool?"
Maybe more like stick the hamster in a black painted box glued to the canvas.
For a long time I felt that government employees were dull because the work dulled them. Now I know that very few would want to have one of those jobs if they could succeed in private enterprise.
Too bad the bald eagle didn’t catch fire and burn to a heap of ash.
It’s beyond ugly, it’s ghastly. Anyway sounds like an easy case for a good tax attorney. The IRS doesn’t make law, it makes policy, when policy conflicts with law, then it’s the judicial systems job to set thing straight ..... that doesn’t mean that these particular IRS officials aren’t stark raving mad.
Yeah... when it goes to court the item will be deemed worthless. Now if in the future Congress eases the restrictions upon eagle carcasses enough to make this piece legal to sell again... then the family might be dinged for capital gains.
I can sort of see the point the person who constructed this (I won’t say artist) was trying to make. Sort of. But it’s like he or she commissioned a little kid to do it after conceiving of the general idea.
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