Tax Court: Donated Conservation Easement Doesn’t Meet Requirements, Disallowed

Tuesday, October 29, 2019 - 9:45am

The United States Tax Court issued a ruling Monday that a limited liability company’s conservation easement failed to meet the requirement for a charitable contribution deduction, disallowing the charitable conservation easement donation. The ruling in Coal Property Holdings vs. Commissioner of Internal Revenue found that the conservation purpose wasn’t protected in perpetuity because the recipient of the charity wasn’t absolutely entitled to a proportionate share of proceeds if the property were sold following a judicial extinguishment of the easement, but by an alternate formula to that required by the regulations.