Prose by Tax Pros

The IRS has been attacking syndicated conservation easement transactions (“SCETs”) for more than half a decade. These disputes often involve prolonged audits, Appeals Office conferences, Tax Court trials, and appellate litigation. Such procedures can have a huge cost, not only to the partnerships, but also to the IRS and the entire judicial system. For instance, even after diverting lots of personnel to its Compliance Campaign aimed at SCETs, the IRS acknowledged in early 2022 that it was still severely understaffed and needed to spend yet more to hire, train and integrate 200 additional attorneys. At this juncture, reviewing proposed solutions, both by the IRS and state tax authorities, for resolving SCET cases is worthwhile. This article analyzes the conservation easement donation process, role of Qualified Amended Returns, prior Settlement Initiative offered by the IRS, and current approach for partners in California. Read the full article here. About Hale E. Sheppard HALE E. SHEPP...

  The article summarizes the rules affecting conservation easement donations, identifies the “technical” arguments on which the IRS has heavily relied, describes newer attacks by the IRS focused on appraisals, analyzes multiple sources supporting valuation of real property based on its highest and best use, and suggests that the IRS has failed to adequately explain why it, taxpayers, and/or the courts should ignore longstanding authorities. Read the full article here. About Hale E. Sheppard HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.) is a Shareholder in the Tax Controversy Section of Chamberlain Hrdlicka and Chair of the International Tax Group.