Colleagues at business meeting in conference room
While art is widely recognized as an asset class, not many people consider it when thinking about their estate and tax planning. Understanding the fair market value of your artwork can be quite useful when considering a museum donation to offset taxable gains or when developing a strategy for equitable distribution.

Cochran Arts was recently asked to join an interdisciplinary team that consisted of a financial advisor, a lawyer, and an accountant to respond to the particular needs of a client. Their goal was to create a trust for their children that included artwork. We were asked to first create an Appraisal for Financial Planning Purposes, which assigned a fair market value to all the works in the collection. From there, the client selected the pieces they wanted to go into the trust, after which we created a separate Gift Tax Appraisal to submit to the IRS.

2021 Figures Are In
The 2022 Art Market Report, prepared by Dr. Clare McAndrew for UBS and Art Basel, was released last month. Here are a few of the highlights:

  • Aggregate sales of art and antiques in 2021 was up by 29% from the year before reaching an estimated 65.1 billion, surpassing even the pre-pandemic levels of 2019
  • Post-War and Contemporary art was the largest sector of the fine art auction market with sales totaling 6.7 billion, up by 42% year-on-year
  • Sales of works in the Emerging Market, or those made in the last 20 years, reached 2.5 billion at auction, more than doubling value from 2020
  • In 2021, just over one third of High Net Worth collectors had spent over $1 million on art and antiques, up from 20% in 2020 and more than double the level in 2019
  • The online market, which experienced a marked rise in 2020, grew again in 2021 by 7% to reach an estimated 13.3 billion
  • Sales of art and collectable NFT's on the Ethereum, Flow and Ronin blockchains have grown from 4.6 million in 2019 to 11.1 billion in 2021
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