A Missouri partnership is liable for penalties after evaluating the appreciation of a conservation easement at more than 14,000% across a 21-month span, the US Tax Court said Thursday.
North Donald LA Property LLC’s $115 million charitable contribution deduction taken for a 260-acre easement in Louisiana was “grotesquely” overstated and should have instead been valued at $176,000, Judge Albert G. Lauber said in a memorandum opinion.
North Donald is on the hook for a 40% gross valuation misstatement penalty under IRC Section 662 because the valuation of the conservation easement was an “outrageous overstatement, wholly untethered from reality,” Lauber ...