Art & Cultural Property Law 2025 Comparisons

United States’ Laws and Authorities in the Field of Art Law

In the United States, art law draws from multiple legal areas, including intellectual property, contracts, torts, and property law, among others. It is shaped by a mix of federal and state statutes, court decisions, and agreements created by art market participants to address gaps in existing legal frameworks.

Copyright and other artists’ rights

Under Title 17 of the U.S. Code, authors of “original works of authorship” “fixed in a tangible form of expression” are granted exclusive rights to reproduce, distribute, display, and create derivative works from their original creations. These rights arise automatically upon the creation of a qualifying work, but registration with the U.S. Copyright Office is necessary to bring a lawsuit for infringement and to access certain remedies. However, many contemporary artworks may fall outside this protection, such as those made from found objects, not physically realised by an artist (but instead, by the artist’s assistants or even by a collector, as is the case with Sol LeWitt’s Wall Drawings), or fixed in a non-traditional, ephemeral medium. For such contemporary artworks, artists and their representatives often rely on contract-based protections of authorship and authenticity. 

The Visual Artists Rights Act (VARA) adds “moral rights” for artists. It allows them to:

• claim authorship of their work;
• prevent false attribution; and
• stop intentional damage or destruction of certain works.

Art transactions

The Uniform Commercial Code (UCC) is a model legislation that is enacted in whole or in part in all 50 US states and the District of Columbia. The UCC governs commercial transactions involving personal property, including artworks, in the context of sales, lending, secured transactions, passing of title, representations and warranties, and other commercial issues.

Article 2 governs the sale of goods, including artworks sold by galleries, dealers, or private parties.

Article 9 governs secured transactions, often relevant in consignment of works to galleries, meaning the artist retains ownership while the gallery takes possession of an artwork and tries to sell it, or when engaging in art finance transactions and using art as the collateral.

Article 12 governs the ownership, transfer, and control of certain digital assets that are not governed by existing articles such as Article 2 or Article 9. Article 12 is relevant to transactions with non-fungible tokens (NFTs) and other digital assets. 

State laws (spotlight on New York)

New York, as a global centre for the art market, has enacted the New York Arts and Cultural Affairs Law (ACA), a legal framework that addresses certain recurring risks of art transactions. For example, Article 12 establishes that when an artist consigns their artwork to a gallery, the artwork and the proceeds from its sale are held in trust for the artist, offering protection in the event that a dealer becomes insolvent. Article 15 requires disclosures in transactions involving fine art multiples (such as limited edition prints), including edition size. 

Case law

The United States follows a precedent-based legal system, which means that decisions made by courts form binding legal rules that guide future cases with similar facts. Contract law shapes disputes involving the sale, consignment, loan, and commission of artworks, with case law, frequently addressing contested issues of authenticity, ownership, and payment. Tort law precedents guide remedies for fraud, misrepresentation, and negligence – especially in matters involving forged or misattributed works.

New York courts in particular have developed influential case law on issues such as authenticity, provenance, and the duties of art dealers and auction houses, and the state’s courts are often the forum for art-related disputes due to the concentration of art market participants in the state. 

Property Rights

An artist’s rights over a physical artwork relate to the control and ownership of the tangible object. When the artwork is sold, the artist usually gives up possession of the physical piece unless there is an agreement stating otherwise. Artists can use contracts to set conditions for how the work is displayed, stored, or handled to maintain its context or condition. In the absence of such agreements, the purchaser generally has full rights to use, display, or even dispose of the artwork.

Copyright

Copyright is the primary legal tool in the United States that protects the creative expression of artists. This gives the artist the exclusive authority to reproduce, distribute, display, and create derivative works from their creation. These rights are not only a means of controlling how the artwork is used and shared but also of providing the artist with the ability to benefit financially from their work, whether through direct sales, licensing, or other arrangements.

Moral Rights

Artists’ moral rights in the United States are protected under the Visual Artists Rights Act of 1990 (VARA) and apply to certain works of visual art. These moral rights enable artists to claim authorship of their work, to prevent their name from being used on works they did not create, and to object to the intentional distortion, mutilation, or destruction of their work. Moral rights may permit an artist to deny authorship or association with a work, particularly due to unauthorised alterations. These protections apply to works of visual art, such as paintings, drawings, prints, and sculptures, and photographs produced in limited editions, and are designed to safeguard the artist’s personal and reputational interests, even after the work has been sold. These rights also are personal to the artist and exist independently of copyright.

Copyright in Joint and Collective Works

When multiple artists collaborate to create a single artwork, copyright law treats the resulting work as a “joint work”, meaning each co-author holds an undivided interest in the entire copyright, unless otherwise agreed. All co-authors have equal rights to use or license the work, but they must share any profits. 

In addition to joint works, collective works combine individual contributions into a larger single work (such as an album or a compilation), and copyright may be held by the compiler or editor. If contributions to the collective work are distinct and separately copyrightable, such individual contributions are registrable either separately or as part of the collective work.

Consequences of Copyright Violations

Violating copyright on a piece of artwork can result in significant legal consequences, including civil and, in some cases, criminal penalties. The copyright owner may file a lawsuit seeking remedies such as actual damages (the financial loss suffered due to the infringement plus any profits of the infringer) or statutory damages, which are predetermined amounts set by law. However, to be eligible for statutory damages and attorney’s fees, the artwork must be registered with the U.S. Copyright Office either before the infringement occurs or within three months of its first publication. Without timely registration, the copyright owner is typically limited to recovering only actual damages. For each work infringed, statutory damages can range from USD750 to USD30,000, or up to USD150,000 per work if the infringement is wilful. Statutory damages may be reduced for innocent infringers (for example, the infringer believed they had a valid licence) down to USD200 per work or forfeiture.

How to Register Copyright

To register an artwork with the U.S. Copyright Office, an application needs to be filled out on the Copyright Office’s online portal, providing the details about the artwork, such as its title, the year it was created, and when it was first “published” (made public). After paying a filing fee, the applicant will need to submit a deposit copy of the artwork, which is usually a digital file, but sometimes a physical copy is required. Once the application, fee, and deposit copy are received, the Copyright Office will review the submission and, if everything is in order, issue a certificate of registration.

Artists’ Resale Royalty Rights

A resale right is a legal concept that gives artists a percentage of the sale price each time their original artwork is resold by others. This right is designed to ensure that artists benefit from the increasing value of their work as it changes hands in the art market.

In the United States, there is no federal law that grants artists a resale right. The California Resale Royalty Act provided this right to artists for sales occurring in California or involving California residents, but it was struck down by the courts in 2018 as being pre-empted by federal copyright law. The Act may still apply in California to a limited number of transactions.

As a result, artists in the United States generally do not receive any payment when their works are resold, unless they negotiate such terms privately in their contracts.

Process for Obtaining Permissions to Use Images Protected by Copyright

Anyone who hopes to reproduce a copyrighted artwork should first find out who controls the rights. After locating the rights holder, the prospective user must determine how they plan to use the image: details about purpose, format, audience, length of use, and geographic reach help the rights holder determine terms and fees.

Permission is usually requested through a formal letter or email that specifies the artwork, intended use, duration, and distribution. If the rights holder consents, the parties should sign a written licence. Copies of all correspondence and the final licence should be kept in a safe place in case the right to use the image is questioned in the future.

Art Authentication After the Death of the Artist

After an artist’s death, authentication may be handled by the artist’s estate, a dedicated foundation or committee, or recognised experts, with the art market and legal frameworks shaping who is accepted as an authority. The artist’s estate, heirs, or a designated entity may (i) hold the artist’s reproduction rights and consequently the unique entitlement to publish that artist’s catalogue raisonné, (ii) have access to the artist’s records and archives, and (iii) rely on personal knowledge, which can be invaluable in determining the authenticity of a piece. Sometimes, the artist may have established a foundation or authentication board during their lifetime specifically to handle such matters after their death.

Alternatively, recognised experts (connoisseurs who have extensively studied the artist’s oeuvre) may be called upon to provide opinions on authenticity. These experts may publish catalogues raisonné, which are comprehensive, scholarly listings of known works by an artist; inclusion in such a catalogue is often considered a strong indicator of authenticity. Art market-recognised practices would dictate which experts’ opinions may carry more weight in the art market. Notably, this is different from the legal frameworks for determining the admissibility of expert testimony in court. 

The case often cited in discussions about art authentication and the weight of expert opinions in court is Greenberg Gallery, Inc. v Bauman, 817 F. Supp. 167 (S.D.N.N. 1993). This case involved a mobile purportedly by Alexander Calder, a renowned artist known for his mobiles. Greenberg Gallery and others purchased a mobile they believed to be an authentic Calder. Later, disputes over the work’s authenticity arose. The plaintiffs sued the seller for rescission and damages, claiming the work was not authentic. During the trial, both sides presented expert witnesses. The court ultimately admitted and credited the opinion of the expert who was not recognised by the art market as the leading authority on Calder. The court found this expert’s testimony credible and persuasive based on methodology, analysis, and expertise. The court did not defer solely to the market-recognised expert, but instead evaluated the substance and reliability of each expert’s opinion. Because legal frameworks may differ from art market conventions, art market participants often prefer to resolve their dispute outside of court (for example, in private arbitration or mediation). 

The process of authentication is not without controversy. Additionally, the subjective nature of art authentication that relies on expert opinion means that disagreements are common. Owners of artworks may challenge negative opinions, and high-profile legal battles have emerged involving authentication boards, some of which have disbanded due to the risk of costly litigation from disgruntled owners of works deemed inauthentic. The stakes are high, as authentication can dramatically affect the value of an artwork. 

Whether Inclusion in a Catalogue Raisonné May Be Compelled

US courts have recognised that the creation and maintenance of a catalogue raisonné, as well as the issuance of opinions on authenticity, are matters of expert opinion and scholarly discretion. Courts are reluctant to compel experts or foundations to alter their opinions or to include works in catalogues raisonné, as doing so would infringe on First Amendment rights and academic freedom.

In Thome v Alexander & Louisa Calder Foundation, 70 A.D.3d 88 (1st Dep’t 2009), a leading New York case on this issue, the court recognised that the creation of a catalogue raisonné is a voluntary act, and neither its issuance nor its contents are controlled by any governmental regulatory agency. As a result, the court declined to compel the artwork’s inclusion in the foundation’s catalogue raisonné.

Civil Remedies Available When Artworks Are Declared Inauthentic After Purchase

When a purchaser discovers that an artwork they bought is later declared inauthentic, several civil remedies may be available, depending on the circumstances of the sale, the representations made, and the applicable law. Common remedies are rescission of the sale, monetary damages, or restitution. Rescission may be available when the sale was based on a material misrepresentation or mistake regarding authenticity. 

Alternatively, the buyer may recover damages (typically, the difference between the price paid and the actual value of the inauthentic work, as well as any consequential damages that can be proven) under various legal theories including breach of contract, fraud or misrepresentation, and other theories. Restitution is a remedy designed to prevent unjust enrichment. If the seller received payment for an inauthentic artwork, the buyer may seek restitution to recover the amount paid. Typically, the buyer would seek several of the available remedies in the alternative, but the court will craft the remedies so as to avoid double recovery. 

Protections of Cultural Property in the United States

While there is no single, universally binding legal definition, “cultural heritage” or “cultural property” generally refers to tangible and intangible assets of historical, artistic, or cultural significance. 

The United States is a party to the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property, as well as several other international conventions and agreements relating to protection of cultural property. The UNESCO Convention defines “cultural property” broadly to include property of importance to archaeology, prehistory, history, literature, art, or science, which includes property of artistic interest. 

The United States formally implemented the UNESCO Convention with enactment of the Cultural Property Implementation Act in 1983, and enacted its own statutes regarding cultural property. These include federal laws such as the National Historic Preservation Act and the Native American Graves Protection and Repatriation Act, which recognise and protect various forms of cultural heritage, emphasising their importance for historical, cultural, and other purposes. 

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Cultural Artifacts and Adverse Possession

Adverse possession is a legal rule that allows someone to gain ownership of another person’s land or personal property if they openly use it for a set time and meet certain conditions. While adverse possession is generally regulated by state law, federal law, and US obligations under international conventions, these will generally not permit cultural artefacts to be acquired by adverse possession. Furthermore, to the extent the cultural artefact was stolen or illegally exported from the country of origin, a subsequent good faith purchaser for value cannot acquire good title. 

This principle was discussed in Autocephalous Greek-Orthodox Church v Goldberg & Feldman Fine Arts, Inc., 917 F.2d 278, 279 (7th Cir. 1990) under Indiana state law. The court in Autocephalous ordered the return of Byzantine mosaics to Cyprus, despite the fact that the items had been in the possession of good faith purchasers for several years. The court also emphasised the importance of returning cultural property to its rightful owner, reflecting a broader public policy interest that supersedes the private interests of possessors.

Another example is the case of United States v Schultz, 333 F.3d 393, 395 (2d Cir. 2003), where the court, applying the National Stolen Property Act (NSPA), held that Egyptian antiquities could not be lawfully owned or transferred, regardless of the length of possession, because they were considered the property of the Egyptian state under its patrimony laws. 

Status of Cultural Heritage Items Discovered by Private Individuals

The legal status of items of significant historical, archeological, or cultural value discovered by private individuals depends on several factors, including the nature of the item, on whose land it was discovered, and whether the item is discovered on the surface or in the ground. In the United States, both federal and state governments may have rights and interests in such an item. Removing artefacts from state or federal lands is illegal. Discoveries on federal land are governed by federal laws. The Archaeological Resources Protection Act (ARPA) provides that archaeological resources found on federal or Native American lands may not be received, purchased, or sold without a permit. While the landowner typically may have the rights to an item found on private land, there are important exceptions for items of significant historical, archaeological, or cultural value. For example, if the item is of Native American origin, tribes may have rights to the item under federal or state law, particularly under the Native American Graves Protection and Repatriation Act (NAGPRA). Discovery of cultural artefacts is required to be reported to the relevant federal or state agencies. 

Main Clauses of Art Sale Contracts

Every contract, regardless of its subject matter, should include certain fundamental provisions to ensure it is valid, enforceable, and clear. These essential provisions include identification of the parties, description of the subject matter, consideration (what each party is giving or receiving), description of rights and obligations, term (duration of the contract), governing law, and signatures of the parties. 

For art sale contracts in particular, the following provisions are important to include in addition to the essential terms of any contract: 

• Description of the Artwork: This section usually includes the title, artist, medium, dimensions, date of creation, and any identifying marks or numbers associated with the piece. To further ensure clarity and authenticity, photographs or certificates of authenticity may be attached as exhibits to the contract.
• Consideration: The contract must state the agreed-upon price for the artwork and outline the payment terms, such as a payment schedule.
• Terms of Transfer: The contract should specify the method, timing, and place of delivery of the artwork, as well as who is responsible for shipping, insurance, and the risk of loss during transit. It also will clarify when the transfer of title and ownership passes from the seller to the buyer.
• Representations and Warranties: The seller typically warrants that they have good title to the artwork and the right to sell it. There often is a warranty of authenticity, confirming that the artwork is genuine and attributed to the stated artist.
• Other Disclosures: The contract also should disclose any liens, encumbrances, or third-party claims, as well as the condition of the artwork and any restoration or repairs that have been made.

Considerations for Cross-Border Art Sales

Compliance with export, import, and cultural property laws is a key consideration when transferring artwork abroad. If these laws are violated, U.S. Customs and Border Protection (CBP) and other federal agencies have the authority to seize the art. Submitting forged or altered documents, such as invoices or export permits, can result in seizure. Importers also must accurately declare the value and country of origin of art. Underreporting the value to reduce duties or misrepresenting the origin to avoid restrictions or tariffs is a violation. Furthermore, artworks or artefacts that were stolen, whether from private collections, museums, or archaeological sites, are subject to seizure under the National Stolen Property Act (NSPA) and other statutes. 

When artworks travel to other jurisdictions, collectors should be aware that laws for determining whether a good title exists may be different in other countries. In the United States, a good faith purchaser for value cannot acquire good title if there is a thief in the chain of title. As discussed in the previous sections, such stolen goods may be seized and repatriated to the original owner. As a result, when an artwork with potential gaps in provenance travels abroad, the owner or buyer may be at risk of losing title. This highlights the importance of conducting due diligence in art transactions, including into title and provenance (ownership history). 

Another key consideration for international transactions is shipping, as artworks are most frequently damaged during transit. Working with experienced art shippers reduces the risk of damage to the artwork. Collectors also may want to consider reviewing their insurance policy to make certain that they have coverage for artworks during transit.

Liability of Auction Houses and Galleries for Sales of Inauthentic Art

Auction houses’ liability is typically governed by consignment contracts with the seller and the terms and conditions of sale with respect to the buyer. While the Uniform Commercial Code imposes baseline obligations with respect to warranties, they typically can be contractually modified. Auction houses make an express warranty of authenticity when their auction catalogue attributes an artwork to a particular artist. The house will usually guarantee the authenticity of an artwork for five years from the date of the sale. If it is determined that the artwork is not authentic within this period, the auction house usually would rescind the sale and pursue their remedies from the seller. Past the typical authenticity guarantee period, buyers may try to bring claims sounding in breach of contract, fraud, unjust enrichment, and other legal theories, but such claims are rarely successful due to the expiration of applicable limitations periods. See, for example, Foxley v Sotheby's Inc., 893 F. Supp. 1224, 1236 (S.D.N.Y. 1995) (dismissing buyer’s claims arising out of inauthentic work after the expiration of the five-year guarantee period).

Unlike auction houses, gallery sales are not public and galleries do not publish catalogues or generally represent authenticity in writing. In fact, there are often no written contracts for the sales of artworks. That said, where inauthentic art was bought from a gallery, buyers may pursue legal issues against the gallery for fraud, breach of warranty, unjust enrichment, and other claims. The cases filed against the famed Manhattan gallery Knoedler, which was discovered to have sold a number of forged Mark Rothko and Jackson Pollock paintings, illustrate these claims. See De Sole v Knoedler Gallery, LLC, 974 F. Supp. 2d 274 (SDNY 2013) and others.

While the art market is not heavily regulated, auction houses typically conduct pre-auction checks due to the commitments they take on as part of their auction terms and consignment agreements. The auction house will typically warrant title to the artwork and warrant authenticity for a period of time (usually five years). A consignor (seller) will typically, in turn, warrant title and authenticity to the auction house in their consignment agreement. Due to the importance of relationships to the auction business, auction houses would typically perform provenance and authenticity checks, including requesting documentation of ownership and exhibition history and confirming whether the artwork is included in the accepted catalogue raisonné for the artist. As the condition of the work directly affects value, auction houses will typically perform a condition assessment. 

As a function of international anti-money laundering requirements, auction houses conduct due diligence on their clients and beneficial owners. This includes verifying their identity and understanding the source of their funds. 

While major galleries are likely to follow similar practices, what specific checks are conducted can vary depending on the gallery size and whether it has an international presence. In the United States, the buyer is ultimately responsible for exercising due diligence in their art purchases. 

An art adviser is someone who provides expert advice, to a private individual or an institution, about acquiring or selling artworks or managing collections of art over time. Art advisers will usually conduct extensive research to support clients in their art endeavours and leverage their extensive networks to help clients acquire or sell art. Further, an art adviser’s role can include representation of buyers and sellers in transactions. The legal status of art advisers is generally regulated by contract, although many advisers operate without a contract. When an art advisor represents both the buyer and the seller in the same transaction, the resulting conflict of interest can expose the advisor to potential litigation.

The art market has become an attractive avenue for money laundering due to its high values, portability, and culture of discretion. The EU and the UK have adopted anti-money laundering directives, requiring galleries, dealers, auction houses, and freeports to conduct transactional and customer due diligence checks.

The United States has made limited progress on similar regulations since 2020. In 2020, the United States enacted the Anti-Money Laundering Act (AMLA), which required antiquities dealers to incorporate AML programmes such as due diligence procedures, customer identification, and reporting of suspicious activities. 

Collections may be protected as cultural heritage when they possess historical, artistic, scientific, or social significance. The legal frameworks governing collections protected by cultural heritage depend on the national laws of the country in which the collection is located. However, there are a number of international laws governing protected collections, including:

• the 1954 Hague Convention, which protects cultural institutions and collections during war; and
• the 1970 UNESCO Convention, which prevents theft, trafficking, and illegal export of cultural items.

As discussed in earlier sections, the United States has implemented laws that seek to protect cultural property from illegal trafficking. State and local governments may regulate historic and cultural properties through landmark preservation boards and other measures. Federal, state, and local funds may be allocated to establish public libraries or support art preservation.

Copyright in Photographs

Under the Copyright Act, photographs are protected as soon as they are created in any physical form, so long as they show a small amount of originality. When courts decide if someone has copied a photograph illegally, they do not protect the basic look of what is shown. Instead, they look at the creative choices the photographer made, such as how the scene is arranged, the lighting, the angle, the timing, and any editing. For example, in Rogers v Koons, 960 F.2d 301 (2d Cir. 1992), the court considered a case where artist Jeff Koons created a sculpture based on a photograph taken by Art Rogers without permission. The court held that Rogers’s creative choices in making the photo, such as composition, lighting, and arrangement, were protected by copyright. On the other hand, in Meshwerks, Inc. v Toyota Motor Sales U.S.A., Inc., 528 F.3d 1258 (10th Cir. 2008), the court addressed whether digital models (which the court equated to photographs) of Toyota vehicles were sufficiently original to be protected by copyright. The court found that because the digital models were essentially exact replicas of the cars without additional creative input, they lacked the originality required for copyright protection. This means that while anyone can photograph the same subject, only the photographer’s unique way of showing the scene is protected. Copying those creative choices without permission can be copyright infringement. On the other hand, photographs taken in a purely mechanical or automated way, such as passport photos taken in a photo booth with no creative input, also may lack the originality required for copyright. Use of another person’s photo-booth likeness, however, may implicate such person’s right to privacy or rights in publicity as discussed in 8.2 Legal Protection for Different Types of Photographs.

Status of Photographs Not Protected by Copyright

If a photograph lacks the necessary originality, it is not eligible for copyright protection. As a result, the general rule is that anyone can use, reproduce, modify, or distribute the photograph without seeking permission or paying royalties. However, other laws may offer protection against unauthorised distribution and copying, although not under copyright law. For example, the use of a photograph could potentially raise concerns related to privacy, publicity rights, or trade mark law, depending on the content and context of the image. If a photograph depicts an identifiable individual, using the image, especially for commercial purposes, could potentially violate that person’s right to privacy. This is particularly relevant if the photograph was taken in a private setting or reveals private facts about the individual. The right of publicity protects individuals from the unauthorised commercial use of their name, likeness, or other recognisable aspects of their persona. Using a person’s photograph in advertising, merchandising, or other commercial contexts could infringe on the subject’s right of publicity, especially if the person is a celebrity or public figure. If a photograph includes trade marks, logos, or distinctive product packaging, using the image in a way that suggests endorsement, sponsorship, or affiliation with the trade mark owner could lead to trade mark infringement or dilution claims. Sometimes, the use of a photograph may be restricted by contract, such as terms of service for a website or agreements with the subject of the photograph.

What Is meant by NFTs?

NFTs, or non-fungible tokens, are unique digital assets that exist on a blockchain. Unlike cryptocurrencies such as Bitcoin or Ethereum, which are fungible and can be exchanged on a one-to-one basis, with NFTs each token is distinct and cannot be exchanged on a like-for-like basis. NFTs are often used to represent ownership of a specific digital artwork, music, videos, collectibles, and even virtual real estate. However, an NFT does not confer copyright or other intellectual property rights over the underlying asset. The exact rights associated with an NFT can vary depending on the terms set by the creator, and these rights should be explicitly outlined in any accompanying agreement or licensing terms.

At the time of writing, the United States does not have comprehensive NFT-specific legislation. However, NFTs are subject to a variety of existing laws and regulations, depending on their use and characteristics. NFTs often involve copyright and trade mark issues, particularly when digital art or other creative works are minted as NFTs without the original creator’s permission.

Inauthentic or Counterfeit NFTs

In the rapidly evolving world of NFTs, the issue of inauthentic or counterfeit tokens has become a significant concern. While NFTs are unique digital tokens recorded on a blockchain, this technology only verifies the creation and ownership of the token – not the legitimacy of the digital content it represents. As a result, counterfeit NFTs can and do circulate in the marketplace, often deceiving buyers and undermining trust in the system.

Individuals may create NFTs using digital assets they do not own, such as a copyrighted artwork or photographs, and then sell these tokens without any rights to the associated digital asset. In some cases, scammers go a step further by impersonating well-known artists or creators, minting and selling NFTs under false identities. This can lead buyers to believe they are purchasing a genuine piece from a reputable source when, in reality, they are acquiring a counterfeit.

Copycat NFTs also contribute to the problem. These are tokens that closely mimic the style, branding, or content of popular NFTs, creating confusion and potential legal issues. Buyers may be deceived into spending significant amounts of money on inauthentic NFTs, while original creators and rights holders may suffer financial and reputational harm. 

To combat these issues, some NFT platforms have introduced verification processes for creators, such as “verified” badges or know-your-customer (KYC) checks, to help buyers identify legitimate sellers. Marketplaces often provide mechanisms for reporting and removing counterfeit or infringing NFTs, and buyers are encouraged to conduct due diligence by researching the provenance of NFTs and the reputation of sellers before making purchases.

Ultimately, while blockchain technology ensures the uniqueness and ownership of an NFT, it does not guarantee the authenticity of the underlying content. The integrity of the NFT market depends on the honesty of creators, the vigilance of marketplaces, and the caution of buyers. As the NFT space continues to grow, both technological and legal solutions are being developed to address the challenges posed by counterfeit NFTs.

Considerations of Planning Generational Transfer of Artworks and Art Collections

Generational transfers of art should be approached with careful, upfront planning to minimise legal and tax risks. State intestacy laws dictate who will inherit artworks by default in the absence of a will, but such disposition may be far from ideal. In the United States, wills and trusts are the common legal instruments that may help an artist or collector ensure that the right people or institutions steward the artwork or collection after death. Many collectors use revocable living trusts to hold artwork during their lifetime and avoid probate at death, which simplifies the process for the heirs and maintains the artist’s or collector’s privacy. 

In appropriate circumstances, other legal structures should be considered, including placing art collections in a limited liability company (LLC). This may be appropriate, for instance, to facilitate fractional transfers to heirs and maintain a collection. For significant collections, establishing a foundation or a private museum may be a preferred manner to steward the collection and provide tax savings. It is important to consider the implications and benefits of each structure to tailor the solution to the artist’s or collector’s wishes.

A significant consideration includes choosing an executor and/or trustee with experience in the management of art collections. This person should have the right skills and experience in dealing with high-value art to be able to effectively manage and maintain a collection or sell the collection, depending on the original owner’s intent and preset plan. Conflict-of-interest considerations should be taken into account (for instance, consider if the art executor may have an incentive to undervalue the artworks for his or her benefit). 

When multiple heirs are involved, the planning must consider whether an art collection will be divided or kept intact, how to minimise potential conflict between the heirs, and how to address value imbalances. Joint ownership is rarely advisable as it creates a frequent source of conflict between the heirs. Due to the personal significance of artwork, collectors may want to consider whether to establish a life estate for their spouse, with the artwork ultimately passing to a child or other family member after the spouse’s passing. 

Successful art succession plans also depend on clear documentation confirming title for each artwork, provenance records documenting the chain of ownership from the artist to the current owner, and appraisals. Collectors should maintain a comprehensive inventory of all artwork that contains details on the artist’s name, title or description of the artwork, date of creation, medium, dimensions, and other relevant information, such as edition numbers. It may be helpful to attach photographs or use digital tools to keep these inventories. Provenance documentation may include certificates of authenticity, the artist’s catalogue raisonné, bills of sale, import/export papers, copies of relevant publications on museum exhibits, and so forth. Gaps in provenance ultimately may destroy the market value of an artwork and are more easily addressed during the collector’s lifetime. Appraisals for insurance or tax purposes are critical for managing an art collection’s value. The U.S. Internal Revenue Service (IRS) has specific requirements for qualified appraisals. Notably, the IRS’s Art Panel may scrutinise appraisals of high-value art reported on tax returns and adjust the values, which may result in tax penalties. Good documentation and the use of qualified appraisals meeting the IRS’s requirements strengthen the heirs’ position. 

Legal and Fiscal Issues in Intestate and Testamentary Succession of Artwork

Intestacy is how an estate is passed to one’s heirs under state law in the absence of a will directing the distribution. For artists and collectors, this means that the artwork and copyrights may be split among multiple heirs. This would, at best, cause a collection to be fragmented and distributed without regard to sentimental, historic, or societal values being taken into account, and, at worst, could force a collection to be sold with the proceeds distributed to the intestate heirs. 

With a valid will (testamentary succession), the art owner can proactively direct what happens to their artwork and related rights. Specific bequests allow designating particular pieces to particular people or institutions, avoiding the ambiguity of intestacy laws. For instance, an artist or collector can ensure a certain painting goes to a named heir or that a collection is donated to a museum. Despite having a will, challenges may arise, including as a result of ambiguous language as to how the assets are to be divided, or due to the possible misconduct of the executors. In the well-known case involving the Rothko estate, the executors were sued for selling art below market value to insiders. The best practice is to distribute artwork in kind with an agreement among the beneficiaries or to sell artwork in a commercially reasonable manner to avoid breaches of fiduciary duty and litigation brought by upset beneficiaries. 

Multiple heirs inheriting an undivided interest in an artwork often leads to conflicts among them. To avoid conflicts, it is advisable to clearly identify who inherits which artwork and document ownership of artwork and collectibles. If the owner wants to avoid distributing fractional interests in art to ensure a collection is maintained in its entirety, the collection may be placed into a limited liability company (LLC). The operating agreement of the LLC can provide a mechanism for the management of the collection and spell out the rights of its members, the beneficiaries of the owner’s estate. 

In sum, the succession of artwork requires careful advance planning and documentation to navigate the legal and financial hurdles and to ensure a smooth transition for heirs. 

Lifetime gift considerations

If an heir is gifted an artwork, for example, by the parents, but it remains in the parents’ home, the IRS may not recognise the gift and include it as part of the parents’ estate. For tax purposes, a gift generally requires that the donor relinquishes control over the property and that the recipient accepts it. To avoid complications, it is important for the donor and recipient to properly document the gift, including transferring possession and filing a gift tax return to report the gift and value thereof. 

Copyright

When a US author dies owning the copyright to their works (which is typical unless they assigned it during life), that copyright becomes part of their estate and can be transferred via will or intestacy. Copyright can be very valuable, as it gives the holder the exclusive right to reproduce, publish, or license the artwork’s image for the remainder of the term (70 years after the death of the author). Managing copyright after the life of the author may become a significant task, and it is especially unwieldy if there are several heirs that become co-owners of copyright. One good approach is for the author’s will to assign copyrights to a single person or entity to manage the intellectual property, to make decisions about licensing, publishing catalogues, pursuing infringers, etc, without having to chase every heir for each decision. 

Digital art and NFTs

Digital art and NFTs pose unique succession planning challenges. Unlike a painting on the wall, an NFT or digital artwork is typically accessed via online accounts, crypto wallets, or storage devices. It is recommended that the owner maintain a secure list of digital assets and their access information, and make arrangements for a fiduciary to obtain the list upon death. 

Fiscal issues

The primary fiscal issues associated with testamentary (by will) or intestate (without a will) succession are associated with estate and inheritance taxes. Because art is illiquid, heirs may be forced to sell pieces quickly to cover estate taxes. If a substantial portion of the estate is in art, it is important to implement strategies in advance to avoid a forced sale shortly after the decedent passes. 

Estate Taxes

Estate taxes in the United States are taxes levied on the transfer of a deceased person’s assets. The tax is applied to the total value of the estate, which includes real estate, investments, and other assets including artwork. The federal estate tax of 40% only applies if the total estate exceeds a certain threshold (more than USD13.9 million in 2025), but some states impose their own estate tax with lower exemption amounts. It is essential to ensure the value of artwork reported on the estate tax return is substantiated by a qualified appraisal.

Inheritance taxes

There is no inheritance tax at the federal level, but five states (Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania) have inheritance taxes levied on the value of assets received by a beneficiary of an estate. Inheritance tax is based on the relationship of the individual to the decedent. Collectors with significant estates residing in these states may wish to consider available measures to limit application of the inheritance tax, including by establishing a trust and transferring artwork to the trust during their lifetime.

Tax Implications for Acquiring Artworks Through Gifts and Donations

In the United States, gifts are taxed on the donor and the recipients of gifts are generally not taxed, either at the federal or state level. Special rules may apply when the recipient is a foreign person. 

Gift tax

Any transfer of artwork to an individual for less than full consideration (whether monetary or in kind) is considered a gift. Generally, gifts are taxable to the donor, unless an exception applies. Under IRS rules, there is an annual gift exclusion (USD19,000 in 2025) to each donee. Any gift in excess of the annual gift exclusion will invoke the donor’s lifetime exemption (currently more than USD13.9 million) and reduce the amount available for them to leave tax-free at death. Gifts to one’s spouse are not taxable regardless of value unless the spouse is not a US citizen. Gifts beyond the exclusion threshold require a gift tax return (Form 709), which must be substantiated by a qualified appraisal. Gift tax returns are due on April 15 following the year in which the gift is made.

Donations to charities

Gifts to qualifying tax-exempt charities (as defined by section 501(c)(3) of the Internal Revenue Code) can provide an income tax deduction to the donor subject to certain limitations depending on the nature of the gift and the type of organisation receiving the gift. Where artwork is gifted, the value of the donation must be substantiated by a qualified appraisal pursuant to IRS requirements. 

What Artworks May Be Excluded from Gift, Estate, and Inheritance Taxes?

Gift tax exemptions

Donations of artwork may be made during the donor’s lifetime, and are taxed as gifts. There is no specific exemption from gift taxes based solely on the type of artwork. Gifts of artwork are subject to the same types of exemptions discussed in 10.3 Tax Implications of Artwork Gifts and Donations (annual and lifetime exemptions). Donations of artworks to qualified charitable organisations may be exempt from gift tax if the artwork is transferred to a charity that is recognised by the IRS as tax-exempt under section 501(c)(3). The donation must meet specific requirements, including proper documentation, a qualified appraisal for artworks, and compliance with IRS filing requirements, such as completing IRS Form 8283.

Estate tax exemptions

Donations to qualified charities may be made in a will. Under IRC section 2055, if a person donates artwork to a tax-exempt 501(c)(3) organisation (such as a museum, university, or public library), the value of that donation is not subject to estate tax.

Inheritance tax exemptions

In the United States, inheritance taxes are imposed by five states as discussed in 10.2 Legal and Fiscal Issues in Artwork Succession, but not at the federal level. The exemption thresholds and tax rates vary by state and depend on the relationship between the decedent and the beneficiary. Generally, assets left to a surviving spouse are exempt from inheritance taxes. There are no specific exemptions from inheritance taxes based solely on the type of artwork.

Placing an Artwork in Trust 

Artwork may be placed in trust. Trusts can be used to manage, preserve, and transfer ownership of artwork while minimising tax exposure and ensuring control over how the artwork is used or displayed. Depending on the structure of the trust used, the transfer of artwork to a trust may remove the artwork from the donor’s estate. 

There are no special penalties for simply placing art in a trust, but collectors should beware of routine traps, including undervaluing art for estate or gift tax purposes, which may result in IRS penalties, or losing the step-up in basis if the artwork is transferred to the trust outside of the donor’s estate. Further, as mentioned above, query whether the artwork will still be included in the donor’s estate if the artwork remains displayed in the donor’s home post-gift. 

Consideration can be given to establishing a special-purpose trust designed to hold and manage an art collection. These trusts differ from a “traditional” trust established to hold and manage assets for the benefit of named beneficiaries and, under applicable law of certain states, may continue in perpetuity. Transfers to a special-purpose trust are taxable gifts if made during the donor’s lifetime and would require a qualified appraisal of the artwork and should be reported on the donor’s gift tax return. These trusts can also be created and funded upon the death of the donor. A special-purpose trust would typically appoint a trustee or “protector” (to oversee the trustee) with knowledge and expertise on art matters who would be entrusted to ensure the collection is managed and maintained as the donor intended.