I'm currently reading* Artists' Estates: Reputations in Trust, by Magda Salvesen and Diane Cousineau, which looks at the management of (mostly) mid-century American male artist's estates, often through the medium of interviews with 'art widows'.
One of the interesting points that comes up in a few of the interviews I've read so far is the 'art widows' reluctance to sell to private collectors, and desire instead to place works in public collections. This seems to be driven by two motives: first, to hopefully enable the work to be seen by a bigger audience, and second, for the tax breaks. One widow noted that a gift of two works to a public collection meant she didn't have to pay income tax for two years.
The American tax system is beyond me, but there's an article in the Wall Street Journal today that looks at the effect of Congress's decision to crack down on tax breaks for fractional giving, where an owner donates a work to a public collection over a period of time, generating tax benefits along the way. Museums are now pressing for another change to the law, and wealth advisors are "steering donors away from fractional giving and toward an array of other complex art-giving vehicles, such as charitable-remainder trusts and donor-advised funds." The desire to give remains strong, according to the article:
"People are very interested in doing things with their art during [their] lifetime," says Lynn Lederman, a senior vice president at Bessemer Trust, a New York firm that advises clients with at least $10 million in assets. This satisfies their philanthropic desires, can reduce the size of their estate for tax purposes, and lets them take active control over where their prized collection goes.
Donating art also shields them from a big tax bill. Though many collectors could make a bundle selling into a hot market, they'd be hit with a sharp federal capital-gains tax -- up to 28% -- on art and collectibles (as opposed to the lower 15% rate on stocks and bonds). That gives them an additional incentive to donate and take a deduction instead.
In New Zealand, there's no financial inducement for an owner to gift (or sell) a work to a public institution, rather than putting it up for auction or placing it with a dealer to sell. I can't help but wonder** whether introducing tax benefits to encourage the gifting of works to public collections might actually be of greater benefit to New Zealand at large than the proposed resale royalty scheme.
In other interesting reading today, Jen Graves considers in the Stranger*** how America's precarious financial situation might impact on her experience of art. Graves notes that while art might belong to the wealthy, the ability to see it is far more open:
The vast majority of people don't even enter art's primary economy, the buying and selling of art, but they interact consistently with art's secondary economy, the viewing economy. We don't pay for art; we pay for the right to see it. And mostly, we pay very little.
I try to resist buzz words, but I'm kinda drawn to that notion of the viewing economy. Graves also notes that, "commercial galleries, paradoxically, are always free". I totally agree - you want to see the most recent and - occasionally - the best and most adventurous? Get thee to an art dealer. They're friendlier than you might think.
I can't finish a post about art and money without pointing you to Jen Bekman's 20 x 200 project: tagline "Great Art $20. Really".
Every week Bekmann makes two art works (a drawing/painting and a photograph) available in three editions: 200 small-sized $20 reproductions; 20 $200 medium-sized reproductions, and 2 $2000 large reproductions (occasionally the original work). All over the net, all equally accessible (providing you're in the right time zone and can handle the postage costs - considerably more accessible in the States!). I think it's fab.
*Well, I'm reading in between the times when I go oh, for godssake and put the book down until my patience reserves are restored. There's a slightly smug, self-entitled but put-upon tone to many of the interviews that I find a frustrating, often, I think, because the 'art widow' is struggling to promote the work of an artist who curators and dealers aren't interested in. On the other hand, I can understand their position, and god knows the emotional pressure must be enormous. That's why I keep picking the book back up.
**Nope, haven't seen the movie, don't plan to unless I'm having a really rough week and it's out on DVD. In which case I think many of the feelings described in * above may apply.
*** Some advertising may offend more sensitive readers