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Document Type

Note

Publication Date

Winter 2019

Publication Citation

94 Indiana Law Journal 331 (2019)

Abstract

Depending on the approach used in enforcement, there is the potential to encourage or discourage charitable donations of conservation easements. In Part I, this Note explores the federal charitable income tax deduction for conservation easements and the legislative purpose in enacting the perpetuity requirements. Part II examines the Fifth Circuit’s decision in BC Ranch II and the flexible approach to perpetuity adopted by the court. Finally, Part III considers the implications of the BC Ranch II decision, specifically authority to monitor conservation easements, valuation gaming of easements in the context of perpetuity, and congressional intent in allowing the conservation easement deduction. Part IV addresses the main arguments against adopting a flexible approach to the easement deduction. Overall, this Note argues that a flexible interpretation of perpetuity by the IRS and the courts strikes the proper balance between respecting congressional intent and encouraging conservation efforts.

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