Conservation Easement Ultimatum: Settle Early or Face Trial

Publication: Tax Notes Federal, July 22, 2024

In July 2024 the IRS offered nondocketed conservation easement cases a settlement allowing a deduction equal to the amount invested, a 21 percent tax rate on the remainder, and a 5 percent penalty. William Stone explains why this best-to-date offer would still be hard to accept.

Barriers include a 30-day window, partner disagreement, a single partnership-level payment, no stated amount owed, continued IRS information requests, and terms the IRS could walk away from.

He concludes the offer works as an ultimatum: settle during the audit or litigate to the end.

Related services: IRS Audits & Examinations · IRS Appeals

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