Some Nevada residents may collect art for many different reasons and may accumulate extensive collections. However, many of them may not properly address their collections in their estate plans.
Not including provisions for a valuable art collection in an estate plan can result in surviving family members being left with an expensive problem to solve. Not only is this lapse likely to contribute to litigation and conflict between family members, it can also result in significantly higher estate taxes.
Art collectors can leave their holdings to loved ones, give them directly charity or have them placed in a trust upon their death. However, many people are unsure about what to do with their collections and continue to delay any decisions until it is too late. One way to bypass such indecision is to place the art under the ownership of a corporation or limited liability company. Doing so may not only resolve ownership issues, but may also make the probate process less of a hassle as the art would not need to be retitled.
There is more to proper planning for valuable art collections than creating an estate plan. There should be sufficient documentation that verifies the ownership of the collection. Art collectors should maintain insurance records, bills of sale, certificate of authenticity and other important documents that can dispute challenges to the provenance of the art. There is an increased likelihood that there will be issues regarding provenance the older a piece of artwork is and the greater the separation from the artist and owner. An attorney can often be of assistance in this regard.