April 15th is just around the corner and there’s no better time to talk taxes; more specifically to talk about charitable contributions of preservation easements. Since 2006, the courts have collectively issued more than 47 decisions involving challenges to deductions claimed under IRC § 170(h) with regard to conservation easement donations. 21 of those 47 decisions are related to preservation or facade easements. The tax courts’ decisions haven’t been talked about to any great length outside typical professional easement circles, like appraisers and tax attorneys, but that appears to be changing. During a recent lunch-and-learn presentation, Easements Atlanta’s Executive Director Angela Threadgill spoke with a well-known Atlanta real estate development team followed by an open dialogue. One of the follow-up discussions pertained to the IRS’s increased scrutiny and tax court challenges. We’re happy these conversations are starting to happen with potential donors, because charitable donations of easements can only move forward when there’s an open dialogue on what lessons have been learned.
Easements Atlanta compiled this condensed summary of recent court decisions on conservation easement donors and donees specific to preservation and facade easements; it includes links to court case specifics if readers need further explanation. It was based on an outline prepared for a workshop, Trying Times: Important Lessons to be Learned From Recent Federal Tax Cases, at the Land Trust Alliance’s national conference in Providence, Rhode Island, in September 2014. Readers interested in this blog post are encouraged to read the full workshop document: LTA Trying Times. Colleagues of the Land Trust Alliance continue to be a great resource for the preservation community involved in charitable donations of conservation easements. With on-going discussions, easement-holding organizations and donors can move forward with confidence knowing where problems exist and what mistakes to avoid.