Just saw a tiktok saying that art investment tax loopholes are very easy and common.
I don’t understand how it can benefit the rich people doing it though.
Say they buy a painting at 10,000£, then donate it to charity a year later. They are now down 10k and also don’t have a painting. How does declaring that as a charitable donation change anything?
In: 88
From what I understand, its the appraised value of said painting that is tax deductible.
Lets say i buy that painting for 10k, and then donate it to the local museum. But before I did that, my dear friend and expert art appraiser claimed the painting is worth millions. I can now claim those millions as a donation. Reducing my tax burden by way more than the 10k it initially cost me to buy.
The scam is that they do not give $10000. They buy cheap art from starving artists for say $100. Then they get it evaluated by a very friendly appraiser who declares it is worth $10000. That is their tax writeoff.
It occurs here in Canada too.
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