Why Going to an Open Studios is Different and Better than an Art Gallery

“AND NOW FOR SOMETHING COMPLETELY DIFFERENT” BY MAXINE FARKAS
JANUARY 20, 2014 (Taken from RichardHowe.com)

2nd floor of Western Ave Studios

The following is by Maxine Farkas, our correspondent at Western Avenue Studios:

I read a comment on Facebook the other day that indicated that there is a lack of knowledge about how the art world works . . . what follows is taken from a Western Avenue Studios Artist Association Vision Statement that was written in the winter of 2006/2007 by Ashlee Welz Smith, Meghan Moore and myself. There have been a lot of changes since this was written and I’ve tried to update it where I could, based on what I know about various entities. (For example, I don’t know much about the structure at UnchARTed)

Artist as Small Business – modes of operation

Traditional Gallery Representation – limited interaction with the public

Traditionally, sales of artist work happens through an art consultant or through established galleries, of which there are two kinds: commercial and non-profit. Commercial galleries, like those on Newbury Street or Harrison Ave in Boston, usually specialize in a specific type of art and represent a limited pool of artists. Non-profit galleries in Lowell – such as the 119 Gallery, The Brush, The Parker Gallery, Zeitgeist and the A.L.L. Arts Gallery – focus on rotating exhibits, which must have an educational component as a requirement of their 501(c)3 status. Non-profit galleries do not represent individual artists except for the duration of a particular exhibit. The artwork that is shown in galleries, both commercial and non-profit, is work that is perceived by the gallery director/curator to be saleable to their particular clientele or which fits a particular theme or – in some cases – both. A third outlet is the co-op gallery which charges individual artists to hang their work, some like the co-op galleries at A.L.L., Zeitgeist and the Brush rent wall space to its artists and the artists are responsible for maintaining their space while others, like the Loading Dock Gallery, are curated spaces where members bring in their work and the gallery takes the responsibility for presenting the work. Very often gallery sitting is a requirement for membership in a co-op gallery.

The way that work is shown in galleries can vary, depending on the venue. If selected for a juried show, an artist may have one or two pieces hanging with a large group of work by others. If selected for a small group show, the artist may have a selection of pieces, hanging with the work of three or four other individuals. A solo show may have up to 25 pieces depending on the size of the gallery, and an artist will often create work for a year or more for a solo show.

Another way that artists can sell their work is through an art consultant who acts as the artist’s representative. However, acceptance in a show by an art consultant or by a gallery does not insure sales. It is quite possible to work for a year to prepare for a solo show and then not sell anything. If work is sold, the artist pays a commission to the gallery or art consultant and these
commissions range from 30% to 60% of the sales price of the work.

Artists can spend up to half of their time marketing their work, sending out images and promotional materials to galleries in hopes of being chosen for representation, or answering calls for entries to juried shows. Once their work is accepted by a gallery or juried show, the artist then promotes the show in various ways, including sending out postcards, utilizing social media and contacting his or her mailing list. In the traditional gallery model, most of the direct contact with the public is made by representatives, and there is little interaction between the artist and the public except at opening receptions.

The Open Studios Alternative – direct interaction

At Western Avenue Studios, the artists open their studios to the public on the first Saturday of each month. Artists are available to talk about their work and to demonstrate how they do what they do. Individuals interested in art are able to see an artist’s entire body of work, not just work that was screened by a third party. If someone is excited by what they see, the creator of the work is right there, available to interact with the viewer. It can be an exciting experience for all involved.

Another advantage to open studios is that the work that is on display covers a broad spectrum of styles and media. There are no filters imposed by third parties between the art and the viewer. Sales are made and orders for new work are given at open studios events. And there is no commission paid on sales.

To paraphrase a current tv commercial . . . thus endeth the lesson.

Since the artists at Western Avenue Studios first decided to implement First Saturday Open Studios in the fall of 2005, we have been open to the public 125 days and close to 56,000 visitors have taken the opportunity to walk the halls, talk to the artists and learn about how art is made.

On an average First Saturday anywhere from 75 to 100 artists will open their studios. On an average First Saturday, relationships between artists and visitors begin or continue to develop. And on an average First Saturday visitors from as far away as Concord NH and Hartford CT come to experience a bit of what Lowell has to offer.

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Lost in the Gallery-Industrial Complex by Holland Carter

Lost in the Gallery-Industrial Complex

Holland Cotter Looks at Money in Art

By HOLLAND COTTERJAN. 17, 2014

A new year. A new New York mayor. Old problems with art in New York. I have a collection of complaints and a few (very few) ideas for change.

Money — the grotesque amounts spent, the inequitable distribution — has dominated talk about art in the 21st century so far. It’s a basic fact of art history. Emperors, popes and robber barons set the model for the billionaire buyers of today. Of course, it is today that matters to the thousands of artists who live and work in this punitively expensive city, where the art industry is often confused with the art world.

The distinction between the two, though porous, is real. The art industry is the nexus of high-price galleries, auction houses and collectors who control an art market renowned for its funny-money practices. In numbers of personnel, the industry is a mere subset of the circle of artists, teachers, students, writers, curators and middle-range dealers spread out over five boroughs. But in terms of power, the proportions are reversed, to the degree that the art world basically functions as a labor source, supplying the industry with product, services and exotic color but, with the age of apprenticeships long gone, only uncertainly sharing in its wealth.

Do I exaggerate? A bit. The argument can be made that labor is benefiting from its ties to management, in a high-tide-floats-all-boats way. Visit art schools or galleries, and you get the impression that a substantial portion of the art world is content to serve as support staff to a global ruling class.

The reality is that, directly or indirectly, in large ways and small, the current market system is shaping every aspect of art in the city: not just how artists live, but also what kind of art is made, and how art is presented in the media and in museums.

I got tired of money talk a while back. Rather than just sputter with indignation, I figured it would be more useful to turn in another direction, toward art that the industry wasn’t looking at, which is a whole lot of art. But reminders keep pulling you back to the bottom line. With every visit to the gallery-packed Lower East Side, I see fewer of the working-class Latinos who once called the neighborhood home. In what feels like overnight, I’ve watched Dumbo in Brooklyn go from an artist’s refuge to an economically gated community.

Recently, my attention was drawn to a controversy surrounding a large and much praised group exhibition installed at a complex of converted warehouses called Industry City in Sunset Park, Brooklyn. The show, “Come Together: Surviving Sandy,” was conceived as a benefit for artists who had suffered losses in the 2012 hurricane and was promoted as evidence of art-world solidarity. Yet a widely read blog, Art F City, reported that the owners of the complex, which had for some years provided low-rent studios for artists, were now raising rents dramatically, forcing many artists to vacate. (Landlords say 25 percent of Industry City tenants are artists). The new residents seem to be an upscale clientele drawn by the artsy atmosphere.

Whatever the full facts, money is the winner, and with that comes caution and conservatism. This is almost absurdly obvious on the high-end of the market. Sales of retrograde “masterworks” can be relied on to jack up the auction charts at regular intervals; the most recent record was set last fall by a $142.4 million Francis Bacon painting of Lucian Freud, a monument to two overpraised painters for the price of one. Meanwhile, big, hugely pricey tchotchkes — new whatevers by Jeff Koons, say — roll out of fabrication shops and into personal museums being assembled by members of the international power elite.

Outside auctions, the marketing mechanics buzz on. Roughly since the end of the multicultural, postmodern 1990s, we’ve watched new art being re-Modernized and domesticated, with painting the medium of choice, abstraction the mode of preference. Together they offer significant advantages. Paintings can be assembly-line produced but still carry the aura of being hand-touched. They can be tailored to small spaces, such as fair booths. Abstraction, especially if color is involved, can establish instant eye contact from afar. If, in addition, the work’s graphic impact translates well online, where stock can be moved eBay style, so much the better.

Other traditional forms — drawing, photography, some sculpture — similarly work well in this marketing context. But an enormous range of art does not, beginning with film, performance and installation, and extending into rich realms of creative activity that defy classification as art at all. To note this dynamic is not to dismiss painting or object making, but to point to the restrictive range of art that the market supports, that dealers are encouraged to sell, and that artists are encouraged to make.

The narrowing of the market has been successful in attracting a wave of neophyte buyers who have made art shopping chic. It has also produced an epidemic of copycat collecting. To judge by the amounts of money piled up on a tiny handful of reputations, few of these collectors have the guts, or the eye or the interest, to venture far from blue-chip boilerplate. They let galleries, art advisers and the media do the choosing, and the media doesn’t particularly include art critics. What, after all, does thumbs up, thumbs down matter when winners are preselected before the critical votes are in? In this economy, it can appear that the critic’s job is to broadcast names and contribute to fame.

Conservative art can encourage conservative criticism. We’re seeing a revival — some would say a disinterment — of a describe-the-strokes style of writing popular in the formalist 1950s and again in the 1970s: basically, glorified advertising copy. Evaluative approaches that developed in the 1980s and 1990s, based on the assumption that art inevitably comments on the social and political realities that produce it, tend to be met with disparagement now, in part because they’re often couched in academic jargon, which has become yet another form of sales-speak.

There’s no question that we need — art needs — an influx of new commentators who don’t mistake attitude for ideas, who move easily between cultures and geographies. Regular gigs in mainstream print journalism have all but dried up, but the Internet offers ambitious options in a growing number of blogazines including Art F City (edited by Paddy Johnson) and Hyperallergic (edited by Hrag Vartanian), which combine criticism, reporting, political activism and gossip on an almost-24-hour news cycle.

And although both are based in New York, they include national coverage and in a feisty mix of voices, a welcome alternative to the one-personality blog of yore. That mix would probably be even more varied, and transcultural, if a few forward-thinking, art-minded investors would infuse some serious capital into such enterprises so they could pay writers a living wage and make online freelance writing a viable way of life.

I don’t know what it would take to get a global mix of voices into some of New York’s big, rich art museums. If archaeologists of the future unearthed the Museum of Modern Art as it exists today, they would have to assume that Modernism was a purely European and North American invention. They would be wrong. Modernism was, and is, an international phenomenon, happening in different ways, on different timetables, for different reasons in Africa, Asia, Australia and South America.

Why aren’t museums telling that story? Because it doesn’t sell. Why doesn’t it sell? Because it’s unfamiliar. Why is it unfamiliar? Because museums, with their eyes glued to box office, aren’t telling the story.

Yes, MoMA and the Guggenheim have recently organized a few “non-Western” shows. MoMA’s  2012 “Tokyo 1955-1970: A New Avant-Garde,” packed to the ceiling with art we’ve rarely if ever seen, was a revelation. But they need to take actions far more fundamental and committed. International Modernism should be fully integrated into the permanent collection, regularly, consistently.

Their job as public institutions is to change our habits of thinking and seeing. One way to do this is by bringing disparate cultures together in the same room, on the same wall, side by side. This sends two vital, accurate messages: that all these cultures are different but equally valuable; and all these cultures are also alike in essential ways, as becomes clear with exposure.

With its recently announced plans for an expansion, MoMA has an ideal chance to expand its horizons organically. The new spaces, which should certainly be devoted to the permanent collection, won’t be ready for several years, but the museum has no excuse for waiting for its long-overdue integration process to begin.

And on the subject of integration, why, in one of the most ethnically diverse cities, does the art world continue to be a bastion of whiteness? Why are African-American curators and administrators, and especially directors, all but absent from our big museums? Why are there still so few black — and Latino, and Asian-American — critics and editors?

Not long ago, these questions — of policy but also political and ethical questions — seemed to be out there on institutional tables, demanding discussion. Technically, they may be there still, but museums seem to be most interested in talking about real estate, assiduously courting oligarchs for collections, and anxiously scouting for the next “Rain Room.” Political questions, about which cultures get represented in museums and who gets to make the decisions, and how, are buried.

Political art brings me back to where I started, with artists, and one final, baffled complaint, this one about art schools, which seem, in their present form, designed to accommodate the general art economy and its competitive, caste-system values. Programs are increasingly specialized, jamming students into ever narrower and flakier disciplinary tracks. Tuitions are prodigious, leaving artists indentured to creditors for years.

How experimental can artists be under such circumstances? How confidently can they take risks in an environment that acknowledges only dollar-value success? How can they contemplate sustaining — to me this is crucial to New York’s future as an art center — long and evolving creative careers? The temptation for many artists, after a postgraduate spurt of confidence, is to look around, see what’s selling, and consider riffing on that. We’re seeing a depressing number of such riffs these days.

Again, do I exaggerate? And, again, sure, to some degree. By no means is all the news bad. Start-up galleries are opening; middle-tier galleries are holding their own, or doing better than that. Artist-intensive neighborhoods like Bushwick and Ridgewood are still affordable, companionable and fun.

But when the rents get too high, or the economy fails, or art buying falls out of fashion, and the art industry decides to liquidate its overvalued assets and leave? Artists, the first and last stakeholders, will have themselves to fall back on. They’ll learn to organize and agitate for what they need, to let City Hall know, in no uncertain terms, that they’re there. They’ll learn to share, not just on special occasions, but all the time. They’ll learn that art and politics are inseparable, and both can be anything and everything. They’ll learn to bring art back from the brink of inconsequence.

As someone long on questions and short on answers, let me ask: Why not start now?

 

artists and taxes

August 1, 2005
Artists and Taxes
By Peter Jason Riley, CPA

Artists and taxes don�t seem to mix very well. Taxes and administrating the business of art are often last on the list of concerns for the visual artist. The artistic temperament simply does not interface well with the exacting rule-filled world of federal and state taxation. Artists tend to avoid the whole matter and consequently leave themselves vulnerable to bad advice. The secret to overcoming this phobia is to develop an understanding of the mechanisms of the tax code and some simple, effective ways of complying with this onerous task. I often use the analogy that you may not need to know how to fix your car but it is helpful to know how it basically works. In so doing you will pay less in taxes and you will be less likely to fall prey to erroneous tax information and disreputable or ill-informed advisors.

A majority of visual artists are considered “self-employed” in regards to filing their taxes. In a legal and taxpaying sense this means that your “business” as an artist and you as an individual taxpayer are one and the same. There is no legal separation, such as one would have in a corporation, partnership, LLC or other legal entity. The artist usually files a “Schedule C” as part of their regular 1040 income tax form, which is where you report your art income and expenses. The artist may file a form 8829 for the home office (studio) deduction and will also be required to pay self-employment tax (Schedule SE) on your net income (profit) as well as federal income tax. All these forms are part of the year-end 1040 income tax filing. As a self-employed artist, you will usually be required to pay estimated quarterly taxes using Form 1040-ES if your Federal tax liability is over $1,000 for the year.

The goal is first and foremost to lower your taxes! The artist has a number of tax deductions that are unique. In the balance of this article I will try to break them down to their component parts to make the issues understandable. For the IRS all deductible business expenses are those that are:

1) Incurred in connection with your trade, business, or profession
2) Must be “ordinary” and “necessary”
3) Must “NOT be lavish or extravagant under the circumstances”

It does not take much analysis to see that these guidelines are not an exacting science. The artist has a large group of basic expenses that easily fit the above criteria: travel (hotel, meals, etc.), vehicle and transportation costs, equipment, art supplies, home studio expenses, legal and professional fees, gallery costs & commissions, etc. Let�s review some of the more complex and contentious deduction areas:

Is Being an Artist a Business?
The first hurdle visual artists often have is the question regarding whether their “art” is indeed a business for tax purposes. The heart of this matter is whether the I. R. S. sees the endeavor as a real “business” or as a “hobby.” Because the artist�s ventures often (sadly) yields losses, the question then becomes when does the tax code determine an enterprise to be a true business as opposed to a hobby. Here’s how you may be affected by these so-called “hobby” rules.

Although you must claim the full amount of income you earn from your hobby, hobby-related expenses are generally deductible only to the extent of income produced by the activity. So if you don’t generate any income from your hobby, you can’t claim any deductions. What’s more, even those hobby expenses which can be deducted are subject to an additional limitation: they are considered miscellaneous itemized deductions on Schedule A, which are deductible only to the extent that they exceed two percent of your adjusted gross income. In contrast, if your activity can be classified as a bona fide business, you may be able to deduct the full amount of all your expenses by filing a Schedule C. In short, a hobby loss won’t cut your overall tax bill because the tax law stipulates that you can’t use a hobby loss to offset other income.

Converting your hobby into a bona fide business means you can deduct a net loss from other income you earn, such as wages and salaries. How does the IRS determine whether your activity is a hobby or a for-profit business? The Internal Revenue Service publications discuss these nine criteria:

1) Whether you carry on the activity in a businesslike manner.
2) Whether the time and effort you put into the activity indicate you intend to make it profitable.
3) Whether you are depending on income from the activity for your livelihood.
4) Whether your losses from the activity are due to circumstances beyond your control (or are normal in the start-up phase of your type of business).
5) Whether you change your methods of operation in an attempt to improve the profitability.
6) Whether you have the knowledge needed to carry on the activity as a successful business.
7) Whether you were successful in making a profit in similar activities in the past.
8) Whether the activity makes a profit in some years, and how much profit it makes.
9) Whether you can expect to make a future profit from the appreciation of the assets used in the activity.

The primary determinant is your ability to make a profit at what you are doing. If your efforts result in a profit in three out of five consecutive years, your activity is presumed not to be a hobby by the IRS. If you don’t meet the three-out-of-five years profit rule, is all lost? Not necessarily, if you can prove to the IRS’s satisfaction that you have made a genuine effort to earn a profit and that the reason you are not successful is related to special circumstances, the IRS might agree that your art is, in fact, a business. This is often true for individuals engaged in the arts, where profits and successes are difficult to achieve. To increase your chance of gaining the IRS’s recognition of your business, I recommend that you run your activity in a professional, businesslike manner. Doing such things as having business cards and stationery printed, maintaining a separate business checking account and telephone number, keeping accurate records of the time you put in, and carefully documenting all business-related expenses. The Internal Revenue Service places great credence on computerized accounting records as evidence of the artist�s “businesslike” intent. Keep records of all show entries (even including ones that you don�t get into) and all gallery activity. In short anything related to attempts to sell your artwork.

Income
Income for the artist includes amounts paid to the artist for their artwork. Income for the artist also includes prizes, awards, fellowships, and endowments received. There is also the concept of “taxable income other than cash.” This includes trades of art between artist and other individuals. For example: an artist agrees to “sell” a painting to another artist by exchanging artwork. The painting that the first artist gives up “costs” $75 (the cost of paint, canvas, and framing). The artwork received has a market value or price of $1,000. The first artist will have a taxable income from this transaction of $925 ($1,000 less $75). In other words the artist received something worth $1,000 but only paid $75.

Travel & Meals
The artist is allowed to deduct all expenses associated with overnight business travel. These include meals (only 50% deductible), hotel & lodging, reasonable tips, dry-cleaning, phone calls home, etc. Overnight travel is roughly defined by the IRS as travel that is far enough away from home so as to make it inconvenient to return home at night. Travel could include expenses related to gallery visits, openings of shows, delivering artwork, art fairs, etc. and will include many of the expenditures made on such trips. The other question often asked is the travel deduction for mixed vacation/business travel. As long as the trip is primarily business then deductibility will be maintained. For example, what if the artist has a five-day trip to NYC for a gallery opening and outdoor art fair that includes a two-day stopover in Philadelphia on the way home to visit a friend. In this case the entire NYC trip would be deductible but the expenses related to the Philadelphia stopover, which was personal would not be. Since maintaining individual meal receipts is inconvenient, consider using the IRS “meal allowance” for deducting meals when traveling. This “meal allowance” (adjusted annually by the IRS) ranges from $30 to $40 per day depending on the location. In practice this means that receipts for meals are not required as long as the travel itself can be substantiated. This “allowance” includes all three meals and incidental expenses for the day. Travel for spouses or dependents are not allowed unless they are employees of the art business.

Meals are deductible (remember, only 50%) as part of the overnight travel and they are also allowed as a separate (non-travel) deduction when they meet the criteria of “ordinary,” “necessary” and business related. This means that the meal must include direct business discussions. This can mean lunch or dinner meetings with agents, fellow artists, gallery owners, etc. If a direct business purpose is clearly documented then the deduction is allowed. These meals could include talks on potential gallery showings, museum exhibits, future sales, Website design or setup, and meetings with lawyers or accountants. The best place to keep records for these expenses is in an appointment book. Log into your book who was present, and briefly the nature and substance of the discussion. I often suggest that you keep a copy of the person�s business card as further substantiation.

Automobile & Vehicle Expenses
The use of an automobile can be one of the most common and largest deductions for the artist. The automobile use expense can be taken in two ways. The first method is by using the IRS “standard mileage allowance.” In 2004 this annually defined allowance is 37.5 cents a mile (40.5 cents in 2005). To take this deduction you do not need receipts, only records that show the distances driven and the business purpose of the trips. These would include travel to galleries and museums; trips to the art supply store, classes, etc. The best tool for tracking and calculating this expense is your appointment book or calendar. If your calendar has a record of business travel it can be used as a tool to estimate your mileage deduction (odometer readings are appreciated by IRS but NOT required). The second method is to write off direct expenses. In this method you actually depreciate the cost of the vehicle (over 5 years) and then tally up gas slips, repairs, insurance, etc and use that amount as a basis for your expense. This method requires more work and organization. If you were writing off a cube van or other larger vehicle, the second method would be preferred. In my practice I often find the mileage allowance method generally yields the highest deduction for straight automobile use. In any case, the IRS allows the taxpayer to calculate the best method year by year and take the one that yields the highest deduction (within limits).

Equipment
Equipment purchased is generally “depreciated” and written off over 5 or 7 years on Form 4562. Depreciation is a technique for expensing or writing off purchases that have a useful life of greater than one (1) year. In other words, a kiln or printing press is intrinsically different in nature than clay, a tube of paint, brushes or photographic chemicals. Supplies such as inks, film, canvas, welding material, etc. will be written off (or deducted) in the year of purchase. Most art equipment including computers is written off in 5 to 7 years; these “depreciable lives” are defined in the IRS code. The main tax strategy when it comes to depreciation is the use of what is often called “the section 179 election.” In 2004 the IRS allows taxpayers to “expense” up to $102K of equipment in any one year ($105K in 2005). In this case the potter is allowed to write-off his/her $5,000 kiln in one year rather than wait seven years to do it. Remember this “section 179 expensing election” only accelerates the deduction into one year. Either way, the artist is able to write-off (depreciate) the full cost of the purchase.

The Home Studio
The home studio (office) has been a contentious subject in my profession for a number of years. With recent legislation, the home office has clearly returned to its rightful place as an allowable deduction for most artists. If you use a room (or rooms) in your home exclusively as your studio, you will probably qualify for the home office deduction. The use of the room can be as a studio, storage area for equipment and art, record keeping for the business, marketing, etc. The home office is a fairly straightforward deduction to calculate on form 8829. It simply utilizes a formula based on the square footage of the business portion (the home studio) of your home vs. the total square footage of the house or apartment and then applies that percentage to all associated costs. The costs could include rent, mortgage interest, real estate taxes, condo fees, utilities, insurance, repairs, etc. Other rules that come into play here include the “exclusive use” requirement. This rule states that the home office must be used only for the business � no “mixed use” allowed. In other words the studio cannot be a part of a larger room such as the living room unless the business part is partitioned off in some way. The home office can be a powerful write-off in that it allows the artist to deduct a part of what were non-deductible personal expenses.

Finally. . .
Remember that this outline is not intended to be the whole story. The Federal Tax Code is very complicated and your specific applications should be reviewed with a tax professional before filing your taxes. The visual artist is unique in the world of taxes. When you are shopping for a tax preparer please make sure they have some experience in taxation for artists. Organizing your numbers using our worksheets (and this article) will make the process easier, cheaper and will help you maximize your deductions. Ask your preparer about other tax saving strategies for self-employed individuals such as retirement plans, health insurance and the timing of deductions.

� Peter Jason Riley, CPA, http://www.artstaxinfo.com