Legal Decisions

On this page, you will find analysis of the latest court cases involving conservation easements or other legal issues related to land preservation in Virginia. Court opinions involving the interpretation or enforcement of conservation easements (or other real estate transactions) will typically be issued by a local circuit court or by the Supreme Court of Virginia.

However, because land preservation so often results in federal charitable deductions for the landowner, many of the cases that I analyze will be tax cases in the U.S. Tax Court, the various federal courts of appeals scattered throughout the nation, or, if we get lucky, the Supreme Court of the United States.

But not all legal decisions are made by courts. Occasionally, administrative agencies will make rulings that are related to land preservation in Virginia; you will also find administrative rulings on this page. These rulings mostly deal with tax issues and are decided by either the Virginia Department of Taxation or the Internal Revenue Service. Miscellaneous other rulings, such as Attorney General’s opinions, will also be found on this page.

IRS Amends Notice 2017-10 Relating to Syndicated Partnerships

The IRS has now officially modified Notice 2017-10. Notice 2017-10, which was released on December 23, 2016, had the primary purpose of designating certain syndicated conservation easement transactions as being “listed transactions.” This designation retroactively imposed additional reporting requirements on landowners and others who participated in these syndicated conservation easement transactions.

Late yesterday afternoon, however, the IRS released Notice 2017-29. Notice 2017-29 amended Notice 2017-10 in two important ways. Continue reading IRS Amends Notice 2017-10 Relating to Syndicated Partnerships

Clower: IRS Investigation Into Abusive Appraisals May Proceed

Earlier today, December 22, 2016, the Eleventh Circuit Court of Appeals ruled that the IRS may proceed in its investigation into allegedly overvalued conservation easement appraisals prepared by a Georgia appraiser. Specifically, the appraiser will be required to provide the IRS with his client lists and other information from his files. Continue reading Clower: IRS Investigation Into Abusive Appraisals May Proceed

Graev II: Tax Court Upholds 20% Penalty in “Side Letter” Case

In a split decision released on November 30, 2016, the U.S. Tax Court has ruled against Lawrence and Lorna Graev’s latest legal challenge against the IRS. Specifically, the Tax Court held that the Graevs could properly be assessed a 20% penalty for substantial underpayment of tax. This was in connection with the Graevs’ failed attempt to claim a deduction for the façade easement that they had donated to the National Architectural Trust in 2004. The Tax Court had previously denied this charitable deduction in a 2013 decision—the infamous “side letter” case. Continue reading Graev II: Tax Court Upholds 20% Penalty in “Side Letter” Case

No Land Preservation Tax Credit for Virginia Localities

On November 24, 2015, the Virginia Department of Taxation released a ruling (P.D. 15-215) holding that Virginia localities are not eligible to claim the land preservation tax credit (LPTC). The term “locality” includes counties, cities, and towns, as defined in Va. Code § 15.2-102. Let’s take a closer look at this ruling. Continue reading No Land Preservation Tax Credit for Virginia Localities

Failure to Attach Appraisal Fatal to Façade Easement Deduction in Gemperle

On January 4, 2016, the U.S. Tax Court released an opinion denying the tax deduction for the façade easement at issue in Gemperle v. Commissioner, T.C. Memo. 2016-1. This tax deduction was denied mainly because the landowners did not attach the required appraisal to their federal tax return. Let’s take a closer look at this case. Continue reading Failure to Attach Appraisal Fatal to Façade Easement Deduction in Gemperle