Art collectors generally put a lot of thought into what artwork to bring into their collection. It can also be very important for them to give careful thought as to what will happen with their collection when they pass away.
Given the great emotional and financial value artwork can have, collectors may have very strong feelings regarding what should happen with their collection when they are gone. So, careful estate planning can be critical for art collectors.
Among the things it can be important to give thought to when it comes to coming up with a plan for the passing on of artwork are:
- One’s overall goals regarding the future of the collection and how best to achieve them: There are a myriad of goals a collector could have for his or her artwork after his or her death. Different estate planning tools and strategies vary in what goals they are best-suited for helping with.
- The wishes and desires of one’s heirs: When planning to give artwork to family members or other loved ones, it can be important to understand whether these heirs would actually want the artwork or would instead want to have proceeds from the sale of it. This can impact what measures to educate the heirs about art and planning steps would be the best fit moving forward. So, talking to one’s heirs about this can be wise.
- Potential tax implications: Given the high value art can have, there can be the potential for the passing on of artwork to trigger tax liability, such as estate tax liability. Strategies exist for trying to prevent the passing on of one’s assets from having unwanted tax effects.
- The potential for family conflict: Given the value art can have, there could be the potential for a collector’s loved ones to later fight about who gets the artwork. Having a clear estate plan and open and honest discussions with one’s heirs about how the artwork will be divided, and why this is the case, could help with preventing such disputes.
Estate plans regarding art collections can be carefully tailored to address a collector’s particular wishes, goals, needs and situation. Estate planning lawyers can assist art collectors with such tailoring.