Will Regulations Prevent Litigation? An Analysis of the U.S. Treasury Departments 2017 Revenue Proposals Concerning Conservation Easement Deductions

The problem with large conservation easements under Section 170(h) and golf courses.

By: Garrett Pratt

The United States Treasury Department’s current proposals for amending Section 170(h) of the Internal Revenue Code, given ongoing litigation, indicate that the Internal Revenue Service is pursuing taxpayers who are claiming large deductions for conservation easements. Until now, litigation has been the means for the Internal Revenue Service to test the validity of a taxpayer’s Conservation Easement Deduction.  This Article suggests that the most efficient regulatory approach the Treasury could take to curb taxpayer abuse of Section 170(h) is to categorically ban golf courses from deduction eligibility.