Mr Aby Rosen, a New York based real estate developer and art collector, and Ms. Victoria Gelfand, a director at Gagosian Gallery Inc., have reportedly agreed to settle New York state claims that they did not pay sales and use taxes on fine art. According to New York State laws, art dealers are exempt from sales taxes if they acquire artwork for the sole purposes of resale. However, according to the New York attorney general, Mr. Rosen could not avoid paying sales or use taxes by claiming that the purchased artwork was for resale because he was treating the pieces as his personal possessions and used the works to enhance the value of his real estate brand and/or for his own enjoyment. In Ms. Gelfand’s case, the attorney general argued that art dealers who display purchased artwork in their homes owe sales or use taxes.
