Your Browser Does Not Support JavaScript. Please Update Your Browser and reload page. Have a nice day! May 2016 – Center for Art Law

May 2016

Can’t Hide from the Taxman As reported by the New York Times New York State Attorney General Eric T. Schneiderman announced a $7 million settlement with real estate developer Aby Rosen for back taxes on $80 million worth of art. Rosen failed to pay taxes accruing since 2002 by claiming the works were purchased for resale when in actuality he kept them in his personal collection – New York allows the purchaser of art to avoid taxes if the purpose of the purchase is to resell the art. DH

Stop Taxing Death and Disability Act Keegan Brennen was born in 1990 with an immune deficiency coupled with learning disabilities. Despite these health-related obstacles, Brennen won his high school’s Excellence in Visual Arts award and went on to attend the New Hampshire Institute for Art. After graduating cum laude in 2012 Brennen’s health issues caught up to him. Less than a year after graduating college, and accumulating $78,000 in student loans, he died due to a brain aneurysm. Brennen’s parents applied for loan forgiveness – death is one reason for federal loan forgiveness. Unfortunately this tragic story didn’t end there.

The discharged student loan debt is taxable income and thus Brennen’s parents had to pay both Federal and State income tax, $27,000 and $6,300 respectively. In September 2014 Angus King, Junior United States Senator from Brennen’s home state of Maine, introduced a bill “Stop Taxing Death and Disability Act” that would no longer require the recipients of loan forgiveness, due to death or permanent disability, to pay taxes on the forgiven loan.

More about Brennen’s case can be found at the Portland Press Herald. Senator King’s bill can be found in its entirety here. Additionally Senator King wrote an opinion piece about the bill for the Portland Press Herald in 2014. DH