A Family’s Billions, Artfully Sheltered

[Liberal_in_LA]

A Family’s Billions, Artfully Sheltered

As he stood in the opulent marble foyer of a Fifth Avenue mansion late last month, greeting the coterie of prominent guests arriving at his private art gallery, Ronald S. Lauder was doing more than just being a gracious host.


To celebrate the 10th anniversary of the Neue Galerie, Mr. Lauder’s museum of Austrian and German art, he exhibited many of the treasures of a personal collection valued at more than $1 billion, including works by Van Gogh, Cézanne and Matisse, and a Klimt portrait he bought five years ago for $135 million.

Yet for Mr. Lauder, an heir to the Estée Lauder fortune whose net worth is estimated at more than $3.1 billion, the evening went beyond social and cultural significance. As is often the case with his activities, just beneath the surface was a shrewd use of the United States tax code. By donating his art to his private foundation, Mr. Lauder has qualified for deductions worth tens of millions of dollars in federal income taxes over the years, savings that help defray the hundreds of millions he has spent creating one of New York City’s cultural gems.

The charitable deductions generated by Mr. Lauder — whose donations have aided causes as varied as hospitals and efforts to rebuild Jewish identity in Eastern Europe — are just one facet of a sophisticated tax strategy used to preserve a fortune that Forbes magazine says makes him the world’s 362nd wealthiest person. From offshore havens to a tax-sheltering stock deal so audacious that Congress later enacted a law forbidding the tactic, Mr. Lauder has for decades aggressively taken advantage of tax breaks that are useful only for the most affluent.

http://www.nytimes.com/2011/11/27/business/estee-lauder-heirs-tax-strategies-typify-advantages-for-wealthy.html

[JPZenger]

1. He should only get a deduction for the art if it is open to the public

[Angry Dragon]

2. Then it should be open to the public

[MADem]

7. His ass needs to be taxed! nt

[ellisonz]

3. Here's a good target for Occupy Wall Street.

Other trusts and partnerships control his real estate properties in Palm Beach and the Hamptons and at 740 Park Avenue, a building that was once home to John D. Rockefeller, and is known as one of the world’s wealthiest apartment buildings.

[Sheepshank]

4. I hate to judge a book by it cover....

but the article lends itself to some judgements.

He simply looks like some smarmy, arrogant, asshole.

[lonestarnot]

8. And an evil asshole.

[WildNovember]

5. 287th richest person in the world (Forbes 400 list) -- donating wealth to his own foundation.

I'd guess that means he can still control the wealth and pass control on to his heirs through the subterfuge of the foundation. Plus the tax breaks.

[notadmblnd]

6. He's got a face only a mother wouldn't be creeped out by.

[shraby]

9. He sure doesn't look like he enjoys life.

[Wilms]

10. .

[Warren DeMontague]

11. "Your wife was just showing us her Klimt"

Oh, you too, huh?

[Blue_Tires]

13. well played....

[progressoid]

15. +1

[AnnieBW]

12. Estee Lauder Is Already On Many Black Lists

Because of supporting Israeli settlements.

http://en.wikipedia.org/wiki/Est%C3%A9e_Lauder_Companies

[Blue_Tires]

14. glad to see this getting more attention

[demgrrrll]

16. A mafia bust out. That is the way that this has all played

out for the middle classes. When I read about the Mafia's bust out tactics I really can't see any difference in the outcome for the middle class. Granted, Lauder took advantage but cui bono? who else benefits. I think congress benefits too with donations for their campaigns.

[Southerner]

17. Occupy Washington and demand the tax code be wiped of all deductions

Deductions are so prevalent now nobody actually pays their fair share of taxes.