« Dumpster Patriots | Main | Catherine Austin Fitts on BlogTalkRadio »

April 10, 2008


Feed You can follow this conversation by subscribing to the comment feed for this post.

Jeff Trexler

This story about art marketeer Larry Salander provides an interesting counterpoint, as does the ongoing Fisk University dispute.

Sometimes I wonder (y'know, when I'm drunk, alone & cynical) whether charitable art valuation isn't basically tulips sustained by the deduction, a la donations in stuffed animal heads before the recent tax reform. Put 90% of this stuff on the open market and it tanks as bad as it did for Salander.

Phil Cubeta

How much is the deduction worth? Why buy something for $100 mil in order to get a $35 mil deduction?

Thank you for the links. Both are fascinating. The Salander piece could be a satire by Petronius. Binion invests in Salander's scheme to pump classical art? Benny (the reputed mobster) Binion's son? I wonder too about how much hot money is in this market. Does art figure in the money laundering trades? Sure is easier to move a rolled up piece of canvas from here to there than 100 million dollars bills secreted on the person of your "mules."

Jeff Trexler

"How much is the deduction worth? Why buy something for $100 mil in order to get a $35 mil deduction?"

That's not what I have in mind--that's part of the 10% that obtains a high price on the market. My focus is on the scads of, well, we could call it subprime art that passes to charity with the valuation set not by the market but a professional valuation.

Maybe it's a painting that's passed through the family for a few generations. A purchase from an emerging artist thirty years ago who never hit it bit. Mediocre work by a big-name artist. Whatever the backstory, there's a lot of art gathering dust in 501c3s that's not worth what it's said to be worth.

I know the Code requires professional valuations to deal with that problem, but consider the dynamics of the market. An assessor who consistently gives low valuations is not going to get the same business as one who consistently gives high values.


Interesting, now I get it. I heard an excellent talk several years ago by a appraiser. He said that valuation was both art and science. An appraiser needs to know whether the gift is to be valued for transfer to children or transfer to charity. The appraiser can defend a range of numbers. The low number for gift tax and estate purposes. The high number for charitable deduction. The IRS can challenge either number, but that may lead to a compromise. So, yes, I see your point about valuation. Of course the charity has to give a receipt for a certain gift value? So it is proceed at your own risk?

The comments to this entry are closed.


Wealth Bondage Premium Content

  • Castle by the Sea
    Provided as a professional courtesy at no extra charge to those with net worth of $25 million or more and/or family income of $500,000 a year or more, and to their Serving Professionals of all genders.