The valuation election closes at six months, and the tax is due at nine.

An artist’s estate has to make its permanent decisions when it knows least. Statutory deadlines set the order. The earliest is the one most often missed, because it looks like a valuation question when it is a filing question.

Published by ArtisDomus, written by Polina Surina.

The first twelve months settle the inventory, the valuation, the copyright, the archive and the studio. Each of those decisions costs more the longer it waits.

In the United States, the estate tax return required by section 6018(a) is due 9 months after the date of death (s. 6075(a), Internal Revenue Code). The tax is due at the time and place fixed for filing the return, ignoring any extension of time to file (s. 6151(a)).

Form 4768 gives an automatic six-month extension to file. The payment date stays where it was. The Internal Revenue Service keeps the two apart. An extension of time to pay must be requested separately under section 6161, in Part III of the same form. An estate that assumes the six months covers both faces an interest charge it did not budget for.

In the United Kingdom the order is reversed, and the tax comes first. Tax on a chargeable transfer is due six months after the end of the month in which the transfer is made. For a death, that means six months after the end of the month of death (s. 226(1), Inheritance Tax Act 1984).

The personal representatives must deliver the account within twelve months from the end of the month of death (s. 216(6)(a)). If three months from when they first act ends later, that date applies. So the money is due six months before the paperwork.

Under HMRC guidance, inheritance tax must be paid by the end of the sixth month after the death, and interest is charged after that. A payment towards the tax is usually needed before a grant of representation is obtained. So an estate whose only large asset is unsold work needs cash before it has authority to sell anything.

Tax on qualifying property can be paid in ten equal yearly instalments (s. 227(1), Inheritance Tax Act 1984). Section 227(2) lists what qualifies. It covers land of any description, wherever it is, and relevant business property. It also covers shares or securities to which section 228 applies, and a business or an interest in a business. Works of art are not on the list, so a studio has no instalment route.

The first question is whether a federal return is needed at all, and a date the estate cannot change decides it. The executor must file if the gross estate at the death of a citizen or resident exceeds the basic exclusion amount under section 2010(c) (s. 6018(a)(1)). The amount that counts is the one in force for the calendar year of the death.

For a death in 2025 the basic exclusion amount is $13,990,000. For a death in 2026 it is $15,000,000. So a death in late December and a death in early January fall under different thresholds.

Two things follow for an artist’s estate. First, the gross estate includes the unsold work at fair market value. An artist with a modest bank balance can leave an estate over the threshold made up entirely of inventory. Second, the test uses the gross estate, before deductions and before any discount is argued. So a return can be required even where no tax is finally paid.

Every later decision depends on a record, and the content of that record is fixed. Section 8.01 of Revenue Procedure 96-15 (Internal Revenue Bulletin 1996-3, page 41) lists what an appraisal of art for estate or gift tax must contain.

Section 8.02 adds a timing rule that is easy to break: the appraisal must be made no earlier than 60 days before the valuation date. So an appraisal done for insurance the year before will not serve.

The value at which an appraisal must be filed at all is old and low. Treasury Regulation section 20.2031-6(b) covers household and personal effects that include articles of marked artistic or intrinsic value totalling more than $3,000 (Revenue Procedure 96-15, s. 2.02(5)). A sworn appraisal by one or more experts must then be filed with the estate tax return. Regulation 20.2031-6(d) requires the size, subject and artist’s name for each painting of artistic value listed (s. 2.02(6)).

Private inventories usually leave out two fields on that list, and those two later decide money: provenance and condition. Neither can be reconstructed after the studio has been cleared.

In the United Kingdom, boxes 1 to 4 of form IHT407 list jewellery item by item from £1,500. They ask for details of antiques, works of art and collections with no value threshold at all. Everything below those boxes goes into one total.

Copyright is the asset most often left undecided in the first year, because it appears on no inventory. In the United States, copyright can be transferred by any means of conveyance or by operation of law (s. 201(d)(1), title 17). It can also be left by will, or pass as personal property under the intestacy rules. Each exclusive right, and any part of one, can be transferred and owned separately (s. 201(d)(2)). Copyright lasts for the author’s life and 70 years after death (s. 302(a)).

In the United Kingdom, copyright lasts 70 years from the end of the calendar year in which the author dies (s. 12(2), Copyright, Designs and Patents Act 1988). Section 93 then does something no inventory records. A will may leave someone an original document or other material thing that records or embodies an artistic work unpublished at the testator’s death. That bequest includes the copyright in the work, unless the will or a codicil shows a contrary intention.

Unsold work is unpublished work. So a will that leaves the studio and its contents to one child has, on the face of section 93, left that child the copyright in everything in it.

One part of United States copyright stays outside the estate’s control. Grants of transfer or licence made by the author on or after 1 January 1978, other than by will, can be terminated (s. 203(a)). If the author is dead, the widow or widower owns the whole termination right, unless there are surviving children or grandchildren (s. 203(a)(2)). Then the widow or widower owns one half, and the children and grandchildren share the other.

The window is five years, opening thirty-five years after the grant was made (s. 203(a)(3)). Notice must be served at least two and at most ten years before the termination date (s. 203(a)(4)). Termination works despite any agreement to the contrary, including an agreement to make a will or a future grant (s. 203(a)(5)).

Moral rights split at the moment of death, and the estate has to know which side it is on. In the United States, only the author has the rights of attribution and integrity (s. 106A(b), title 17). They cannot be transferred (s. 106A(e)(1)). For a work created on or after the effective date, they last for the author’s life (s. 106A(d)(1)).

In the United Kingdom, the rights under sections 77, 80 and 85 pass as the will directs (s. 95 of the 1988 Act). Failing that, they go with the copyright where it forms part of the estate, or otherwise to the personal representatives. They last as long as copyright lasts (s. 86). The right against false attribution under section 84 lasts until twenty years after death.

The figure on the return keeps working after the tax is paid. Property acquired from a decedent takes a basis equal to its fair market value at the date of death (s. 1014(a)(1), Internal Revenue Code). The basis is the cost figure used to work out the gain on a later sale. If an election under section 2032 has been made, it is the value at the applicable valuation date (s. 1014(a)(2)).

Section 1014(f)(1) then caps it: where the final value has been determined for estate tax purposes, the basis cannot exceed that value.

The executor must send a statement giving the value of each interest in the property, as reported on the return (s. 6035(a)(1)). It goes both to the Secretary and to each person acquiring an interest from the estate. It is due by the earlier of 30 days after the return was due, including extensions, and 30 days after it was filed (s. 6035(a)(3)(A)).

An estate that valued the work low to reduce tax has given every beneficiary a low basis and a bigger gain on any later sale. Section 6035 then obliges it to tell each of them, in writing, within thirty days, exactly what that figure is. These two sections defeat the strategy of leaving the collection unvalued so that heirs cannot argue about numbers.

The archive is where the first year quietly settles facts. A studio is cleared, works go into storage, unfinished pieces are separated from finished ones, and papers are boxed. Each act settles a fact that Revenue Procedure 96-15 will later ask for. These include what a work is, whether it was ever exhibited and its condition. They also include which objects the artist regarded as finished. None of it can be reconstructed later. None of it has a deadline, and that is exactly why it gets postponed.

As dates, the sequence is short enough to remember. Every entry is a statutory deadline.

These deadlines concern tax and paperwork, yet what the estate knows about its works decides each one. By month six, it knows only what it wrote down in month one.

In the artists’ estates we assess, the list of works is usually there. What is missing is a record of which objects the artist had released and which they had not. That difference separates an inventory from a body of work.

This entry summarises published law and is not legal or tax advice.