Have You Included Your Prized Collection in Your Estate Plan?
Jan. 16, 2019
Many people are involved in collecting, whether it is comic books, dolls, figurines or sports memorabilia. Most of them make an effort to take care of their collections, maintaining the original packaging or even keeping the items in a climate-controlled area. Yet far too few collectors actually plan for how their collections will be handled once they die.
Your collection might be valuable. You should find out whether it is and how best to maintain that value. Or, your collection might not be worth much in money terms, but it could be a treasure to the right party. After all, you’ve spent considerable effort building it.
If you don’t sell off or donate your collection while you are alive, your treasured items will be distributed through the probate process. In that process, your executor or personal representative will need to catalog and value all your property and then distribute it to your heirs and beneficiaries.
If you don’t make a concrete estate plan for your collection, you risk all your years of work and passion going to waste. Without an idea of its value, your executor might simply sell the collection at a garage sale. Or worse.
The first step in planning for your collection’s future is to find someone who would like to receive it. Is there a family member who has the same passion — and the resources to store, care for and maintain the collection? Could you find a buyer? Or is there a charity, such as a museum, that would be interested in taking it on?
Don’t simply speculate about who might want the collection. Ask specific people and organizations about their interest. Managing an extensive collection can take effort and resources, and not everyone can afford to accept collections, even when they are given as gifts.
Inventory the items by listing each one, its condition and any other information such as the purchase date and price, in a computer spreadsheet. Try to document the case for the collection’s maximum value.
Once you’ve inventoried the collection, it is a good time to have your collection appraised. You should seek an appraiser who has experience valuing collectibles — the more similar to yours, the better. The appraisal will give you and your executor an idea of what to expect and may spark ideas.
Once you’ve identified a family member, friend, charity or buyer, make a long-term plan. An estate planning lawyer can help you set up a long-term plan for your treasured collectibles that will limit any unnecessary taxation and ensure your beloved objects continue to be appreciated for a long time to come.