What are collectibles?
According to the IRS, collectibles includes works of art, rugs, antiques, any metal or gem (with exceptions), any stamp or coin (with exceptions), valuable alcoholic beverages or “any other tangible personal property that the IRS determines is a “collectible” under IRC Section 408(m)”.
Quite often people don’t have any idea how much their collections are worth which is why when you are doing your estate planning it is in your and your heirs interests to find out. If you plan on bequeathing your collectibles, it is a necessity.
If you own any antiques or other collectibles you should decide how you want to distribute them after you die. You can either donate them to charity or leave them to heirs. The problem is collectibles fall into special laws separate from other assets. That is why you need to appoint someone who knows the value of your collectibles. Experts say you should contact at least two dealers or auction houses that deal in your type(s) of collectibles. They will come in handy for whoever settles your estate. They will know how much your collection is worth which can prevent any fighting among heirs, each of whom may have a different idea of their worth.
By having this information it will also prevent a clueless heir from selling any objects for less than their fair market value. It is good to remember that even if your heirs decide to keep the assets rather than sell them, they will still need to know the value of your “objects” to establish the total value of your estate.