IRS Commissioner Charles Rettig recently told a Senate hearing that despite his agency’s development of a comprehensive enforcement strategy to address abusive syndicated conservation easement transactions, the schemes persist. A U.S. House bill was introduced in 2021 to crack down on abuse of the charitable conservation-easement deduction, which is intended to help preserve public lands. However, some “syndicators” have devised a tax shelter, typically through a single- or multi-tier partnership, by grossly inflating the value of the land’s development potential and offering investors a share of the tax deductions in excess of their investments in the partnership. Stay tuned.
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