Fifth Circuit overturns Tax Court’s imposition of gross valuation misstatement penalty in conservation easement case but leaves Tax Court’s highest and best use determination undisturbed

Legal concept

The ongoing Whitehouse saga reaches what is likely to be its final resting place following the second decision by the Fifth Circuit (Whitehouse IV) upholding the Tax Court’s valuation finding on remand (Whitehouse III), but vacating the Tax Court’s decision to impose gross valuation misstatement penalties due to lack of reasonable cause.  While expressing sympathyRead More

North Dakota State Law Limiting Conservation Easements to 99 Years Prevents Tax Deduction

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A conservation easement in North Dakota was disqualified for a charitable contribution deduction because the state’s law limits easements to a maximum duration of 99 years, regardless of whether the parties agree otherwise.  The IRS determined, and the Tax Court agreed, that the 99-year limit kept the easement from protecting its conservation purposes “in perpetuity,”Read More

Continued War of Attrition on Façade Easements

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In what appears to be the latest volley by the IRS in its relentless attack on the use of façade easements, the IRS issued IR 2014-31, which is a news release that announces that the IRS Office of Professional Responsibility (OPR) has reached a “settlement” with a group of appraisers accused of participating (called aidingRead More

Giving to a Qualified Organization is a key to Conservation Easement Deduction

CE

Readers know that Sirote & Permutt is frequently hired to defend IRS challenges to deductions claimed by taxpayers relating to qualified conservation contributions (otherwise called conservation easements).  The basics under Code Section 170(h) provide that a “qualified conservation contribution” is a taxpayer’s contribution of a qualified real property interest, to a qualified organization, exclusively for conservation purposes. AsRead More