IRS Pressed on Legal Interpretation Behind Deduction Disallowal

The IRS faced questions from federal appeals court judges on whether statutory language supported the agency’s initial win in a case involving $97.4 million in charitable deductions for two land deals.

Pine Mountain Preserve LLLP is appealing its loss at the U.S. Tax Court to the U.S. Court of Appeals for the Eleventh Circuit, arguing that the deductions should have been allowed. Land deals known as conservation easements trigger a tax deduction if they meet the requirements of tax code Section 170(h), including that they protect the conservation purpose of the easement “in perpetuity.”

Oral arguments ...