Heirs of a wealthy New York art dealer were left a $65
million sculpture that might just be more trouble than its worth.
Illeana Sonnabend, who died in 2007, left an art
collection worth an estimated $1 billion. But one item in particular, Robert
Rauschenberg's “Canyon,” is an heir's nightmare, a lawyer's dream and an IRS
conundrum. The bequest comes with a $29 million tax bill, but since the piece
includes a stuffed eagle, it can't be sold, according to The New York Times.
Lawyers for Sonnabend's children and beneficiaries, Nina
Sundell and Antonio Homem, are hoping federal tax collectors change their
valuation of the item, since they're stuck with the piece - and the taxes on
it. But for now, the IRS isn't budging, and the case may be decided by a jury.
“We are hopeful for it to be resolved before a trial,”
tax attorney Ralph Lerner told FoxNews.com.
Federal law makes it a crime to possess, transport, sell
or otherwise convey a bald eagle, whether it is alive or, as in this case,
stuffed. Sonnabend got an informal waiver from the U.S. Fish and Wildlife
Service in 1981 that allowed her to keep the piece, considered a masterwork of
20th century art. (Rauschenberg got a waiver for the artwork by showing that
the bird had been killed and stuffed long before the restriction was enacted.)
Sonnabend died in 2007 at age 92. The estate tax, which
at the time of Sonnabend's death stood at 50 percent on estates above $1
million, was suspended in 2010 as part of the Bush-era tax cuts, which were
renewed and remain in effect until the end of this year.
Placing a value on an item that cannot be sold is no easy
feat. The venerable auction house Christie’s placed the value of
"Canyon" at zero. The IRS initially put it at $15 million, then
jumped the figure to $65 million when Sundell and Homem refused to pay,
according to The New York Times.
The IRS, which declined to comment on the matter, is not
only asking for $29 million in taxes, but also an $11.7 million “gross
valuation misstatement” penalty, according to Forbes.
Sundell and Homem, who could not be reached for comment
Tuesday, have paid $471 million in federal and state estate taxes related to
the collection and have already sold roughly $600 million worth of art to pay
those taxes, Lerner told FoxNews.com.