Years ago, you created an estate plan. You provided for your spouse and children, and you may have included a bequest to your favorite charitable organization. As each year passed, your family situation didn’t change, so there was no real reason to update your plan. But you earned more money and had a bit more disposable cash for purchases you hadn’t considered in the past.
Over time, you began to buy interesting pieces of art. Some you knew to be valuable, and other pieces you felt an emotional connection with. Recently, you may have done some research or had an insurance valuation and realized that you have a significant amount of wealth on your walls.
It May Be Time to Consider Your Estate Plan
If you fail to include your art collection in your estate plan, it’s possible it will pass to your heirs with the rest of your estate. This could come with a considerable tax bill that will need to be paid by your estate. The taxes may be so high, some of the art may need to be sold in order to pay the government.
Your art collection likely has financial and emotional importance to you. Thus, when re-thinking your estate plan, it is important to consider things such as:
- The tax implications of your bequest.
- How the beneficiary will likely care for the art.
- Whether the art will be seen and enjoyed by others.
Together, these considerations may help you decide whether you want to leave your art collection to your children, a museum, your alma mater, or another beneficiary. Whatever you decide, make sure that you review your will and trust, and all of your estate planning documents, to make sure your wishes will be honored.