Wouldn't make a difference.because she is not ... canadian-born ?
It was bought when Liebovitz was at the edge of bankruptcy, so the discussion in the article about the price makes sense.Buy for $4.75M and two days later attempt to have it valued at $20M? Sounds like a tax scam. Setting aside for the moment the issue of whether the photographs are of "outstanding significance" and "national importance", if it was an arms length transaction, then the tax authority ought to value the collection at $4.75M. That of course would provide a much smaller tax benefit to the donors, but if their intention was a "transformative philanthropic gift", then that should pose no issue for them.
Most recent sale price is the best indicator of value. If the collection was worth $20M, you'd think Leibovitz could have gotten more than $4.75M even given her financial difficulties.It was bought when Liebovitz was at the edge of bankruptcy, so the discussion in the article about the price makes sense.
The seller could have held it and then sold it instead - quite possibly for something quite close to the $20,000,000.
Would you say the same if the gallery turns around and sells it for the $20,000,000?
Wouldn't make a difference.
It was bought when Liebovitz was at the edge of bankruptcy, so the discussion in the article about the price makes sense.
The seller could have held it and then sold it instead - quite possibly for something quite close to the $20,000,000.
Would you say the same if the gallery turns around and sells it for the $20,000,000?
It was bought when Liebovitz was at the edge of bankruptcy, so the discussion in the article about the price makes sense.
The seller could have held it and then sold it instead - quite possibly for something quite close to the $20,000,000.
Would you say the same if the gallery turns around and sells it for the $20,000,000?
if the person had the collection appraised by an appraiser and they valued it at $20,000,000 whats the difference ?That's the nub of the issue. If it could be sold for $20m, then there would be tax to pay on the profit. By "donating" it at $20m valuation, they get a tax credit higher than the $4.5m purchase price. This amounts to legalized theft from Canadian taxpayers.
I understand where you are coming from, but situations like this highlight a not unexpected consequence of trying to use the tax system to accomplish goals that aren't related to the purpose of income tax.That's the nub of the issue. If it could be sold for $20m, then there would be tax to pay on the profit. By "donating" it at $20m valuation, they get a tax credit higher than the $4.5m purchase price. This amounts to legalized theft from Canadian taxpayers.
Annie Leibovitz no longer owns those photographs
I understand where you are coming from, but situations like this highlight a not unexpected consequence of trying to use the tax system to accomplish goals that aren't related to the purpose of income tax.
To save $4.5 million in tax, the donation has to be valued for tax purposes at a value a lot higher than $4.5 million. And the donor/taxpayer has to have a lot of income subject to tax.
So the system usually results in some of the value of the donation coming from the donor, and some coming from the taxpayers.
If the donor turned around and sold the photographs for $15.5 million more than they paid for them, they would only pay tax on half of the gain. So by deciding to donate them instead, they were forgoing a lot more than the tax they would have saved.
The net result of this is that the Art Gallery of Nova Scotia is now the owner of photographs that have a market value somewhere between $2.25 million and $20 million.
Annie Leibovitz no longer owns those photographs. She has only received half of the $4.5 million she expected for them.
The donor is out half of $4.5 million, and may end up having to pay Liebovitz the other half, if the donor ends up being able to claim a larger tax deduction than what is currently being permitted.
And the Canadian taxpayer is out an uncertain amount, but certainly an amount that will end up being far less than the eventually determined value of the Art Gallery of Nova Scotia's new collection of rather special photographs.
Bear in mind that the donors are the Mintz family, well established accountants. I suggest they knew precisely what they were doing and what benefit they could receive should the $20m valuation be accepted. Their only problem is they know nothing about the photography market and, while Leibovitz has an internationally recognized name, it doesn't necessarily follow that her work is highly prized by collectors.
but her work IS highly prized by collectors ...
this thread reminds me too much of the sour grapes
but her work IS highly prized by collectors ...
this thread reminds me too much of the sour grapes
people on this forum ( and others ) have because someone
is selling work for $$$ in galleries or getting national or international acclaim.
her work has sold for well over a few thousand dollars an image, she has been photogarphing
for 40+ years and is an established photographer who is being and has been collected for a long time.
i mean, she photographs the royal family, john and yoko and handfulls of others.
it doesn't matter who the family is or that they are accountants ... they bought the collection
which was undervalued and donated it for about what it is probably worth.
I don't think anyone here is begrudging AL the 4.5M she may be paid, much less the 2.25M she was paid. But buying the work of a well known artist for 4.5M then immediately claiming a value of 20M does seem a bit fishy. This isn't Antiques Roadshow where someone buys a dusty painting at a garage sale. Even fishier when you consider that they only paid half and only pay the 2nd half if the 20M valuation goes through.
There are a few ways I could see the value going from 4.5M to 20M. The artist dies. Pieces are bought in mass and sold individually. But that's not the case here.
If they bought for 4.5M and claimed 9M, maybe. If they had owned the collection for a while, maybe. But this one is "too cute by half".
Perhaps there's an important gallery there, like in Mabou.There's a followup article linked at the bottom of the OP. I find the last bit of it the most interesting:
Why a Nova Scotia gallery?
One thing that's perplexed some observers is why the Leibovitz collection would end up at an art gallery in Nova Scotia.
Art lawyer Aaron Milrad said he believes Leibovitz, who had financial problems when she sold the collection, needed money but wanted to avoid flooding the U.S. market with her work.
He also noted it's not just anyone who can come up with $4.75 million US. Generous Canadian tax benefits for donating certified "cultural property" would encourage a Canadian to buy it and donate it to a regional gallery outside the U.S.
"That's significant," Milrad said. "It would go into a museum in Canada — not the U.S. — would not deal with her U.S. market and would not go into the market generally.
"It wasn't a big sale to a dealer or to an auction house that would resell it."
It includes both the iconic John Lennon + Yoko Ono photograph taken hours before Lennon was murdered (and was on the cover of Rolling Stone magazine) as well as the famous blue "Blues Brothers" photograph that also ended up on the cover of Rolling Stone magazine. Both of which would likely fetch a decent price.Without knowing the content of the donation, it's hard to say if it is worth $20m or not.
yeah maybe ...
IDK
i have bought things for 35$ and sold them for $400 before
to me at least seemed like the same sort of thing
Further, he did not really buy the collection for 4.75M. He bought it for half that and agreed to pay AL the other half IF he gets the 20M deduction. That's a red flag to me.
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