How do people shelter overseas artwork purchases from domestic taxes?
- Saturday Oct 24,2009 01:46 AM
- By diddy
- In Others
I recently read an article about people who shelter US taxes on art sales by doing transactions using European holding companies. Does anybody know how this works? I’ve heard of sheltering royalties in Holland, like the Rolling Stones or U2, but how does that work for fine art?
Art Sales, Artwork, Fine Art, Holland, People, Rolling Stones, Royalties, Taxes Sales, U2
One Comment
The purchase of art is not taxable in the US.
There is capital gains tax on the SALE, no matter where the artwork is located in the world.
If a holding company buy and sells art and is a foreign corporation, there is no US tax.
However, a US citizen’s ownership of a foreign company must be declared to the Dept of Tresury and is subject to IRS regulations. If the US citizen receives income from that company, it will be taxed, as US Citizens are taxed on worldwide income.
Note that the Rolling Stones and U2 are NOT US citizens.
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