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Inheritance tax on physical object

Forum|Forum|3 years ago
November 16, 2022
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Sold a painting I'd inherited many years ago as a private sale. There is no associated assessed value from the time of death or inheritance because of the situation at the time. Will I owe taxes on the money & from whom would a form come from?

Best answer by Anonymous_

You clearly know the sales price but you also need to know your basis in the painting in order to determine your taxable gain (which would typically be capital gain). Your basis would typically be the fair market value on the date of death of the person from whom you acquired the painting.

A certified appraisal (as of the date of death of the decedent) is the best evidence of the fair market value.

A

Anonymous_Answer

Employee

You clearly know the sales price but you also need to know your basis in the painting in order to determine your taxable gain (which would typically be capital gain). Your basis would typically be the fair market value on the date of death of the person from whom you acquired the painting.

A certified appraisal (as of the date of death of the decedent) is the best evidence of the fair market value.

L

lnglgs57Author

My problem is that it's a painting, which shouldn't be a problem EXCEPT - when he passed in 1972 the entire estate of paintings (hundreds of his works), was assessed as ONE THING. There IS no separate appraisal. There is no unique basis.
And from whom would I receive a form? Everyone associated with the work has passed except my 94 year old Aunt, & she handled the sale with her commission proceeds reverting to a 501(c)(3) foundation for his work. The admin of the foundation has already said they're not sending one because it wasn't sold out of the foundation.

A

Anonymous_

Employee

Your issue is simply this:

If you cannot establish a basis for the painting, then the IRS can assign a basis of $0, which obviously will cause the entire selling price to be considered capital gain.