Viewing Question: Can I put art in a CRUT and get income if it is sold?

Can I put art in a CRUT and get income if it is sold?

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I found a piece of art in my attic and it turns out to be very valuable. I want to sell, and I’ve heard taxes on Art are high. I’ve heard about CRUTs as a way to get income from a low cost basis item.

1 Response

  1. The short answer is yes you can. This is a little tricky because art sales can take some time, and art is a non income producing property, so it can’t pay you income until it gets sold. There are several types of CRUTs that work well with Art. They include the NIMCRUT (Net Income With Make Up Charitable Remainder Unitrust) where the CRUT pays income only if the income is below a minimum stated payout, and allows for catchup payments in subsequent years. There is also a FLIP CRUT which starts out as a NIMCRUT and flips to a regular CRUT when the property is sold.

    However, there are an awful lot of other considerations to be cognizant of. These are very complex legal entities and you should absolutely consult with several professionals before going ahead with a FLIP CRUT, or other artwork related CRUT.

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