CLEMSON, S.C. — Conservation easements, the purchase of development rights (PDR), and similar transactions have garnered a great deal of attention over the last decade by farmers and landowners. Not only because of the potential to save farmland, timber stands, and open spaces but also because of available federal tax benefits.
The tax benefits have been so positive for farmers and some landowners that some individuals have begun nefarious schemes in an attempt to abuse the federal tax benefit. So much so that the U.S. Department of Treasury’s Internal Revenue Service (IRS) has put out information to let the public know that they are not only scrutinizing conservation easement syndicates but are prosecuting the syndicates and have even developed an opportunity for them to step forward for a possible settlement.1 It is important that when selling or donating a conservation easement or PDR, IRS tax code and regulation is followed. Please use a tax professional experienced with these types of transactions to provide you with guidance to help navigate the complicated rules which apply.
The information in this publication is provided only for educational purposes and to inform the reader of relevant topics. This is not to be perceived or utilized as formal tax or legal advice. It is up to the reader to seek the necessary and appropriate tax and legal professionals that specialize in these areas for specific guidance.
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— Clemson Extension Land Grant Press