Lessons on Charitable Conservation Contributions from Scheidelman v. Commissioner

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On July 14, 2010, the U.S. Tax Court issued its opinion in Scheidelman v. Commissioner, T.C. Memo. 2010-151, and the decision provides conservation easement professionals with two important lessons. First, it is critical to have a qualified appraisal that satisfies the requirements of the Treasury Regulations and adequately substantiates the value of the easement, by explaining the methodology used and the property-specific facts forming the basis of the valuation determination. Second, a cash payment by the taxpayer to the easement holder is not considered a deductible charitable contribution if the payment is required by the easement holder as a condition of accepting the easement.

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