Month: January 2022

(Liberty Matters News Service) Syndicated conservation easements have once again turned up on the Internal Revenue Service’s (IRS) 2021 “Dirty Dozen” tax scam list. They were first added to the list of schemes the IRS finds are the most fraudulent in 2019.

The syndicated conservation easement practice the IRS is targeting is when it is used as an investment tool, instead of a legitimate charity “gift.” Investors purchase property they can place in a conservation easement, and then divide the property among its clients. The conservation easement on the property is contracted through a willing land trust, and the charitable tax-deduction is split among the client owners.

What has caught the IRS’s attention is that many of these syndicated conservation easements have substantially increased the value of the property when reported to the IRS, making the tax-deduction substantially larger than the cost of the property — in many cases more than 250 percent of the value of the property. IRS Commissioner Chuck Rettig said the practice “defraud[s] the government of revenue. Putting an end to these abusive schemes is a high priority for the IRS.”