Sotheby's just sold my painting at auction this morning.

[DFW]

44. You had an easier time than I did Well done!

My dad’s mom collected modern art in the 1940s and 1950s. Living artists with names like Alberto Giacometti.

When she passed away in 1966, all the grandkids could pick one painting or sculpture. My cousin wanted a Giacometti bronze, but it was assessed at $16000. My aunt and uncle couldn’t afford the (then-) applicable 50% inheritance tax of $8000. The sculpture came up for sale some 40 years later, and brought $4 million.

I was always fond of an abstract blue painting by an artist who died AFTER my grandmother did, and so my parents only had to pay $300, i.e. half of the assessed $600.

Well, fast forward, and the artist who did my painting now has his own room at the MoMa. BUT—since my grandmother bought her painting directly from the artist, the NY art snobs said my painting had to be a fake. They kept that up for years until I finally found a photo of the artist sitting in a Paris gallery (the one that issued my grandmother the bill of sale), with him and the gallery owner sitting under MY PAINTING!

Long story short, I decided I had had enough of the painting, and sold it. As an inheritance kept for more than one year after acquisition, I owed the Germans nothing (THERE was a first!). But the IRS came and said I owed 31.8% on the gain—be prepared, by the way, you might be in a similar position. Consult a tax attorney! You might not like the news, but it’s better than being called in for tax evasion down the road. Besides, what’s left over will be one hell of a sum, too.

So, I paid the IRS their 31.8%, and then gave my brother and sister and each of their spouses $50,000 each, spreading it out to be under the yearly limit for gift tax. Nothing they inherited was worth six figures, and the last thing I was gonna do was flash my good fortune in their faces.

Ergo, I ended up with a sum that was less than half what the painting sold for, but I got something even more valuable: a great relationship with my siblings for life, plus some insurance that I could pay all my daughters’ education bills in the States.