On November 25, 2020, the Internal Revenue Service (IRS) updated its Conservation Easement Audit Technique Guide with a revision date of November 9, 2020. The Guide is a reference document for IRS staff for the examination of charitable contributions of conservation easements. Although the IRS is quick to point out that the Guide is not
IRS Finalizes Settlement of Syndicated Conservation Easement Transactions Under Initiative to Resolve Pending Cases
The Internal Revenue Service (IRS) announced on August 31, 2020 that Coal Property Holdings, LLC and its partners agreed to a disallowance of their $155 million charitable deduction claimed for a conservation easement donation on 3,700 acres in Tennessee (IR-2020-196).
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Senate Report on Syndicated Conservation Easement Transactions
Senate Finance Committee Chairman Chuck Grassley (R-Iowa) and Ranking Member Ron Wyden (D-Ore.) released a report on their bipartisan investigation into syndicated conservation easement transactions (report summarized here). These abusive transactions are created by promoters who sell interests in land to taxpayers seeking large tax deductions. Upon investing in these schemes, the taxpayers grant conservation easements using inflated appraisals and then share the inflated tax deductions among the investors. The abusive nature of these transactions stems from the inflated appraised values of the conservation easements and the effective purchase by investors of tax deductions, both concepts negating any charitable intent by the donors of the conservation easements. The report states that the IRS estimates that between 2010 and 2017, syndicated conservation easement transactions have generated $26.8 billion in charitable contribution deductions for the investors.
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Great American Outdoors Act Permanently Funds LWCF
On August 4, 2020, the Great American Outdoors Act was signed into law, providing $900 million of full and dedicated funding of the Land and Water Conservation Fund (LWCF) for the protection of parks, wildlife refuges and recreation areas at the federal, state and local level. The LWCF was created by Congress in 1964 with