We have done a number of these
transactions. Marie Malaro (A Legal Primer on Managing Museum Collections) goes
into exactly the paperwork you need to do in order for this to be legal and
usable for the IRS. There’s a whole sub-section in her book dedicated
these types of transactions. If you do these types of purchases it would be
good to read this section. We actually call it a “bargain sale” for
accession method. It keeps things nice, neat and clear. The credit line tends
to be along the lines of ‘Museum purchase with donation from Mr. and Mrs.
Smith’.
-Michelle
Michelle Gallagher Roberts
Chief Registrar
(formerly
505-476-5066 phone
505-476-5076 fax
From: The Museum
System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Chad Petrovay
Sent: Monday, October 12, 2009 11:08
AM
To: [log in to unmask]
Subject: Re: Accession Method
Wow –
didn’t realize that would spark quite a discussion – but thanks to
everyone for their input.
~Chad
From: The Museum
System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Glosson, Eunice
Sent: Monday, October 12, 2009
7:28 AM
To: [log in to unmask]
Subject: Re: Accession Method
In most instances
the need for a tax write off is the reason for the bargain/sale. The
owner would like to give the entire object, but is not in a financial position
to do so. Thus the reason for both a deed of gift and a sale agreement.
Sometimes, even a vendor will offer a bargain sale; they feel altruistic,
but they also need to make a sale. I find these a win-win arrangement,
even though the paperwork is ten times the usual transaction!
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Christine Droll
Sent: Monday, October 12, 2009
10:15 AM
To: [log in to unmask]
Subject: Re: Accession Method
But doesn’t
the donor/seller want a tax write-off for the “gift” (value of
object minus the selling-price) portion to the museum? Hence, the museum
must furnish a deed of gift?
Christine
Christine Droll
Collections
Database Administrator
The Nelson-Atkins
Museum of Art
4525 Oak Street
Kansas City, MO
64111-1873
t: 816.751.1333
f: 816.751.0499
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Aylsworth, David
Sent: Monday, October 12, 2009
9:11 AM
To: [log in to unmask]
Subject: Re: Accession Method
I have a hard time
in seeing such a thing as a gift at all, which is probably my being
obstinate. I think that if the Museum paid someone, the person who got
paid has a role of “seller”; the accession method is
“purchase”. I try to retain the whole notion of a “partial
gift” for cases where a donor has only given a percentage interest in the
artwork, and the Museum does not yet fully own it.
But that’s
just me…
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Glosson, Eunice
Sent: Monday, October 12, 2009
9:08 AM
To: [log in to unmask]
Subject: Re: Accession Method
We do a two part
document, a Purchase and Sale Agreement, along with a Deed of Gift for the gift
portion. I was wondering how you document these in the constituent
portion of TMS? Right now I am calling these a Partial Gift, but have
never been completely satisfied that the purchase portion is represented up
front.
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Aylsworth, David
Sent: Monday, October 12, 2009
9:58 AM
To: [log in to unmask]
Subject: Re: Accession Method
Hi Eunice,
Those are a little
complicated when the “donor” wants a gift form for their portion of
a bargain sale. I try to encourage them to handle it more on their side
with their accountant than on ours. In my mind, a bargain sale is nothing
more than a deeply discounted purchase. The relatively few times that it
occurs, I like to see a purchase agreement drawn up that acknowledges what the
insurance value of the piece is, as well as what price the Museum has agreed to
pay. The “donor” (actually, the “seller”) can
then work out their own tax forms to recognize this as a bargain sale.
Does that make
sense?
David
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Glosson, Eunice
Sent: Monday, October 12, 2009
8:43 AM
To: [log in to unmask]
Subject: Re: Accession Method
How do you handle
bargain/sales?
Eunice Glosson
Registrar for
Collections and Museums
Colonial Williamsburg
Foundation
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Aylsworth, David
Sent: Friday, October 09, 2009
6:00 PM
To: [log in to unmask]
Subject: Re: Accession Method
In Houston, we
very much consider this to be a PURCHASE. It’s something that is
always being confused by our curators, but I try to drill home that anytime the
institution cuts the check, the accession method is PURCHASE. If we do
not cut a check, it is a GIFT.
Similarly, the
role of the person who gives funds for a purchase is a FUNDER. If they
give an object, they are a DONOR. Something that is purchased should not
have anyone with a DONOR role linked to it.
I actually set it
up procedurally that we cannot buy a work of art unless the purchase order is
accompanied by an “art purchase form” which is a crystal report out
of TMS. The “art purchase form” will not run if there is not
someone identified as a “dealer or seller” as well as someone
identified as “funder” and the accession method switched over to
“purchase”. It’s worked surprisingly well
David
David Aylsworth
Collections
Registrar
Museum of Fine
Arts, Houston
telephone:
713-639-7824
fax:
713-639-7780
Opening Sunday: The Moon: "Houston, Tranquility Base Here. The
Eagle Has Landed"
From:
The Museum System (TMS) Users [mailto:[log in to unmask]] On Behalf Of Chad Petrovay
Sent: Friday, October 09, 2009
4:32 PM
To: [log in to unmask]
Subject: Accession Method
How do you handle
Accession Method when an object is purchased by the institution with funds from
a donor. Is this considered a Gift, a Purchase, or do you have some other
designation for it?
Many thanks,
Chad Petrovay
| Collections Database Administrator
MIM—Musical Instrument Museum
| 8550 S. Priest Drive | Tempe, AZ 85284
480.481.2460 main | 480.353.2746 direct | 480.481.2459 fax |
www.themim.org
Blog:
www.petrovay.com/tmsblog
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