IRS Dirty Dozen List of Tax Scams
Syndicated Conservation Easements Named on IRS Dirty Dozen List of Tax Scams
Promoters syndicating conservation easements that allow investors opportunity to claim charitable contribution deductions in amount exceeding amount invested.
The Internal Revenue Service announced that a significant increase in enforcement actions for syndicated conservation easement transactions is in progress. A priority compliance area for the agency.
Syndicated conservation easements are private placements, that promise tax deductions worth 4 to 4-1/2 times a person’s investment.
Some syndicated conservation easement deals are offering investors charitable contribution deductions on taxes for large amounts.
According to the IRS, coordinated examinations are being conducted across the IRS audit department. To name a few that should be aware;
- Small Business
- Self-Employed Division
- Large Business
- International Division
- Tax Exempt and Government Entities Division
Separately, investigations have been initiated by the IRS’ Criminal Investigation division. These audits and investigations cover billions of dollars of potentially inflated deductions as well as hundreds of partnerships and thousands of investors.
According to an IRS Notice: The Treasury Department and the IRS have become aware that some promoters are syndicating conservation easement transactions, which purport to give investors the opportunity to claim charitable contribution deductions in amounts that significantly exceed the amount initially invested.
In such a syndicated conservation easement transaction, a promoter offers prospective investors within a partnership or other pass-through entity the possibility of a charitable contribution deduction, for donation of a conservation easement.