Divorce is stressful enough for Illinois couples without having to worry about having to deal with valuable assets. For art collectors, dividing your collection can be a concern with significant financial and emotional implications.
The first step in dividing an art collection is to determine who owns it. If the collection was acquired before marriage, it may be considered separate property and not subject to division. However, if the collection was acquired during the marriage, it may be considered marital property and subject to division.
Once ownership is determined, the next step is to value the collection. This can be a complicated process, as the value of art can fluctuate significantly over time. For the best result, you can work with a qualified appraiser with expertise in valuing art collections. The appraiser will consider factors such as the artist, the medium, the condition of the artwork and the market demand for the work.
Making a decision
Once the collection is valued, the couple will have to decide how to divide it. There are several options.
One is to sell the collection and split the proceeds. This is a common choice for divorcing couples, especially if neither party wants to keep the collection. The proceeds can be split based on an agreed-upon percentage.
Another option is for one spouse to keep the collection after the divorce. If one party has a stronger emotional attachment to the collection, they may want to keep it. In this case, the other spouse may be compensated with other assets of equal value.
A third option is to reach a compromise by dividing the collection. If both parties want to keep some of the artwork, they can divide the collection based on an agreed-upon plan.
Something to consider for divorcing art collectors is the tax implications. If the collection is sold, capital gains taxes may result.
Finding common ground
Divorcing couples with art collections have several options for dividing their assets, depending on their attachment to the art and their willingness to compromise. It’s essential to determine ownership, value the collection, and work constructively toward finding the best solution possible.