The IRS today announced that it is focusing “a significant increase in enforcement actions for syndicated conservation easement transactions.”
As noted in the IRS release—IR-2019-182—coordinated examinations are being conducted across divisions within the IRS (that is, the Small Business and Self-Employed Division, Large Business and International Division, and Tax Exempt and Government Entities Division). The IRS release explains that separately, investigations have been initiated by the IRS’ Criminal Investigation division.
The IRS previously identified certain syndicated conservation easements as “listed transactions” under Notice 2017-10—specifically, transactions for which investors in pass-through entities receive promotional material offering the possibility of a charitable contribution deduction worth at least two and half times their investment. Today’s release indicates that for many of these transactions, the deduction taken is significantly higher than 250% of the investment. Syndicated conservation easements were included on the IRS’s 2019 “dirty dozen” list of tax scams to avoid.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.