IRS Wins on $155.5 Million Tax Fight Over Conservation Donation (1)

A coal partnership can’t take a $155.5 million charitable deduction for donating certain property ownership rights, the U.S. Tax Court said in an Oct. 28 ruling.

Coal Property Holdings LLC donated a conservation easement over its 3,713 acres to a Tennessee land trust in September 2013.

A conservation easement allows taxpayers to claim a charitable deduction for donations of property that will be protected from future development.

But the court said the deed didn’t meet tax code Section 170(h)(5)(A)‘s requirement to protect the conservation’s purpose “in perpetuity” because the land trust receiving the donation ...