Friday, March 2, 2012

Even Rich Heirs Deserve A Fair Shake From The IRS -

The IRS wants to tax the Sonnabend estate on a Rauschenberg that can't legally be sold, on the grounds that law-abiding heirs can always sell on the black market. Huh?

It appears that Sonnabend’s heirs sold off works by Jeff Koons, Roy Lichtenstein, Andy Warhol and Cy Twombly to pay estate taxes of $331 million to Uncle Sam and $140 million to New York State.

But they couldn’t even consider selling what might have been the most famous piece in her collection — “Canyon” by Robert Rauschenberg— because the collage contains a stuffed bald eagle and selling it would be a criminal offense, punishable by a year in federal pen.

Given that restriction, the Sonnabend estate tax return (and three different appraisers the estate hired) valued the work at $0. The IRS says it is worth $65 million and is demanding an additional $29 million in tax and an $11.7 million “gross valuation misstatement” penalty from the estate.

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