A donation to the nation can sometimes avoid inheritance taxes in the United Kingdom.
The United Kingdom has a law that benefits the nation as well as the estates of famous artists with donations that allows the estate to avoid an inheritance tax. Lucian Freud’s estate is the latest to take advantage of this law as reported by the Guardian in “Lucian Freud archive given to nation in lieu of £2.9m in inheritance tax.”
Specifically, the law allows people to give important works of art and other cultural objects to the United Kingdom instead of paying the inheritance tax. Freud’s estate previously gave 40 Frank Auerbach paintings and drawings to various museums and galleries in exchange for not having to pay £16 million in inheritance taxes.
Another £2.3 million (US$3.5 million) was avoided in 2013.
Now the estate has avoided an additional £2.9 million (US$4.4 million) in taxes by giving a collection to the National Portrait Gallery in London.
While the United States might not have this exact same scheme as in the United Kingdom, there are other ways that estates can ease their estate tax bills.
An estate planning attorney can help with the planning required to ease the tax burden on your estate.
Reference: Guardian (Nov. 16, 2015) “Lucian Freud archive given to nation in lieu of £2.9m in inheritance tax.”
