U.S. Tax Court Memorandum Decision Upholds IRS Penalties on Conservation Easement Deduction

The U.S. Tax Court, in a memorandum decision, held that the IRS complied with the supervisory approval requirements for asserting penalties against the taxpayer, granting the IRS’s motion for partial summary judgment. Taxpayer, a limited liability company treated as a partnership for tax purposes, claimed a charitable contribution deduction for donating a conservation easement. The IRS disallowed the deduction and asserted penalties. Taxpayer argued the IRS failed to obtain proper supervisory approval for the penalties under IRC §6751(b). The court held that the IRS met the requirements of §6751(b) because the revenue agent’s immediate supervisor signed the penalty approval form ...