Estate Planning for Artists
Let Professionals Manage the Art
For more information about artist estate planning, read Artist Tips: Checklist for Planning Your Art Estate
Q: I sometimes think about what will happen to my art once I'm gone and what plans I should be making in advance. I wonder who should inherit or control it, or who should manage or be in charge of selling or donating it. I have well over 400 pieces at my studio. Should my wife and children handle it or should that responsibility go to a gallery or someone who's represented or sold my art over the years? How about donating everything to a museum? Would that be a good idea?
A: Unless your immediate family members know plenty about your art and career as an artist, are capable of handling your business affairs, and can represent and show the work like the pros, putting them in control of your estate can potentially do more harm than good not only in terms of the market for your art, but even worse, to your legacy as an artist. In fact, the more successful you are and the less they know about the workings of the art world, the greater the chances that problems can arise as a result of mismanagement, mistrust, infighting, disagreements, and overall inabilities to work with the art community. Family members who lack appropriate knowledge of an artist's art and career, and an understanding of how the art business works, are often completely unprepared to organize, present, price, show, sell, and promote the art effectively. And this is even more likely to be the case if you don't adequately prepare and educate them in advance about their responsibilities in this regard.
Family members who don't know what they're doing can cause all kinds of problems. To name just a few, they can confuse sentimentality with dollar value, have no idea what to sell and what to keep, won't know the difference between the best art and the rest, and may have difficulty telling the difference between opportunists out to take advantage of them, and galleries, consultants, or other reputable qualified fine art professionals who genuinely want to help. On the business end of things, they may have trouble setting realistic prices, set prices way too high (or too low), ask for too large a percentage of sales when working through galleries or representatives or consultants, or refuse to listen when well-meaning professionals present good reasons for pricing the art reasonably. As a result, getting the art out into the public becomes difficult and in extreme cases, the legacy and market for an artist's art can be substantially compromised because no one wants to deal with the people controlling the estate.
Less often, family members grossly undervalue the art and either sell it off in bulk for much less than it's worth, or occasionally even throw out or destroy quality pieces that they decide for whatever reason aren't significant or that they simply don't like. At worst, personal feelings can sometimes override reason, experience and understanding. Family members are not always to blame, by the way. Sadly, a significant number of artists fail to update family members on what's happening with their art, careers, selling prices, accomplishments, and reputations in the arts community. To complicate matters, they keep poor or nonexistent records, don't bother documenting their art and histories as artists. And worst of all, they don't provide specific instructions on how to archive, organize, maintain, donate, preserve or sell their.
Best procedure for preserving, maintaining, and managing your art is for you or any artist is to make arrangements in advance with a gallery, galleries or other experienced art professionals to represent your estate and to continue to show and sell your art on your behalf after you're gone (assuming that's what you want, of course). If you've had reasonable success in your career, consulting an attorney in advance who's familiar with handling artist estates is an excellent idea, as well as discussing the potential tax implications of your estate with an accountant. The decision on whether to have family members sit in on negotiations or to simply present them with the final decisions and agreements is up to you.
When negotiating or hammering out contracts (with the assistance of attorneys, consultants or accountants as required), issues worth considering or including are current wholesale and retail price structures (by the piece, or according to size, medium or other characteristics), seller commissions, methods of payment, percentages of profits from sales that go to specific family members, and how and where the art is to be stored, maintained and accessed. Ultimately, galleries or estate administrators should have control over whether and how much to raise or lower selling prices in the future, as well as when and where to show it, so don't be too rigid or insistent here. When a percentage of the art is to stay in the family, leave complete instructions as to who gets what (as well as who DOESN'T get what), and also on how they can get it appraised, sold, or donated if or when those situations arise. Lastly, make sure every piece is catalogued and itemized according to your agreement. This may sound like a lot of work, but it pays huge dividends if you do it all in advance.
For those of you who don't have established relationships with galleries, agents, consultants, or representatives, consider cultivating and hopefully establishing one sooner rather than later, or at the very least, either building or expanding your website to archive and document your work, and have the necessary interface in place to offer either some or all of it for sale. Another option would be to have educate and instruct someone knowledgeable about your art and career-- perhaps a close friend or associate-- represent and sell your work. But galleries, dealers or related art professionals are generally better for this. In any case, make sure you adequately research and get referrals from artists and collectors before proceeding with any particular gallery, executor, agent, or representative. If for some reason your only option is to work with people you don't really know, consult an arts attorney, an accountant, and an appraiser first in order to make sure you're protecting your interests.
As for donating to museums or other institutions, contact any that have expressed interest in your work over the years, ask whether they still have interest, get some idea of the art they want the most, and do your best to donate exactly what they ask for. Don't insist that anyone take more than they ask for, or try to micro-manage the specifics of a donation, or indiscriminately approach or attempt to donate to places that aren't fans of your work. Excess or unwanted donations of art are often refused altogether, or when they are accepted, either get placed into eternal storage or can even end up getting auctioned or sold at fundraisers or white elephant sales.
Only consider a mass donation if an institution is particularly interested and can offer a concrete plan for your art. If your primary reason for donating is tax related, make sure you review all IRS restrictions and requirements in advance, how much you can claim, what your approximate deductions might be, and plan everything out well ahead of time. In the overwhelming majority of cases, unfortunately, artists donating their own art can only deduct cost of materials rather than actual value of the art, so fully research and understand your options in that regard. Working with tax specialists and professionals familiar with art is highly recommended.
Several simple steps you can take right now or at any time to enhance the future significance as well as market values of your art are to make sure everything is signed, titled or identified, dated or labeled with related specifics about when it was created, and recorded, catalogued, annotated, and organized-- including sketches, drawings and lesser works. Be aware that in situations where artists leave behind lots of unsigned works, those representing the estates are often forced to make estate stamps or provide other forms of identification or documentation after the fact that they're by the artist in question. Galleries and collectors view these pieces as less desirable in the marketplace than hand-signed ones because they raise doubts or questions about why the artists never signed them. Consequently, buyers tend to pay less for them than they do signed works.
Also document as many pieces as possible in terms of age, significance, and other relevant details as relate to the overall timeline of your career. Good documentation increases everyone's understanding of your art-- including you-- as well as its value, both historically and marketwise. Collectors prefer knowing more about the histories behind what they buy rather than less, and pay for that privilege. You younger artists might even think about starting this process now while the details of your careers and individual works of art are still fresh in your minds because the more time that passes, the hazier you'll get when it comes to recalling and piecing together the progression of your artworks, career, and important artistic events in your life.
(art by Alan Ebnother)
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