Appraised Amounts for Art Deduction Widely Exaggerated

The LA Times lead a story from page one today on the wide-spread abuse of the deduction available for the charitable donation of art allowed under the current tax code (Link). Analysis of IRS data by the Times found that of the taxpayers who were audited for this deduction more than 52% had their appraisals rejected by the IRS, and almost 96% of appraisal errors favored the taxpayer.

The rules around the deduction make the deduction wide open to abuse if you can find a "sympathetic" appraiser or approved charity or non-profit organization willing to overpay for some quid-pro-quo in the background, which the LA Times in fact hints at in the article.

The chances of being audited, though, appear very slim. The article points out that in a broader decline in the number of overall audits, only 7 taxpayers out of 108,554 who claimed the deduction for charitable donations of art were audited in 2004! With numbers like that, the odds are obviously stacked in favor of those willing to be "aggressive" in their use of the deduction.

Rules for the claiming a tax deduction for the donation of art.

If Only Hillary Would Pick Up the Phone We Could All Sleep Soundly

It's 3am. A phone is ringing in the White House. Meanwhile a mother frets as she looks over her child who is sleeping soundly. However, she just knows in her gut that "something is happening". But there is no need to worry as the phone is being picked up right this moment by the Commander In Chief who never sleeps. Yes, it's 3am and she's dressed and ready for action, her Rolodex of all the right people within focus of her bifocal lenses.

The Hillary Clinton campaign ad featuring the 3am phone call while a mother frets over her sleeping children reminded me of Makan Emadi's work of George Bush sleeping soundly. This clever little piece even includes a ceramic head of the restful Commander-in-Chief George W. Bush made by the hands of the multi-talented artist Makan Emadi.

When I first saw the ad replayed on PBS's "Bill Moyer's Journal" last night with analysis by Kathleen Hall Jamieson, it actually made me laugh. Oh, my god, something’s happening! Be scared, be very scared! But don’t worry, mother, your little children can keep on sleeping soundly, as Commander-in-Chief Clinton is picking up the phone and knows just whom to call to make it all better. In the morning you’ll still be able to go to the mall.

But it struck some fear into me too; isn’t this the very same tactic used by the Bush campaign in 2004? Recall the references to "the smoking gun being a mushroom cloud" and "uranium yellow-cake sales from Nigeria to Iraq" that made a lot of mall-shoppers vote for George Bush? Hopefully tactics like this remind people how this is more of the "same old, same old".

Hopefully Makan Emadi won't be laying a bomb-splattered doll of Hillary Clinton next to George Bush in the near future. Come to think of it, perhaps he should be busy making dolls of worried mothers and sleeping children to lay beside Hillary Clinton under the blood-splattered bed-covers.

So what do you think? Your comments are welcome.