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Federal Appeals Court Sides with Professor Roger Colinvaux in Land Use Case


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The United States Court of Appeals for the Fourth Circuit issued a ruling on Dec. 16 in a land use case from North Carolina that drew the involvement of Catholic University law school Professor Roger Colinvaux. 

In Belk v. Commissioner, (No. 13-2161) the 4th Circuit affirmed a Tax Court ruling that a conservation easement that authorized the parties to agree to “substitutions” or “swaps” (i.e., to remove some or all of the original protected land from the easement in exchange for the protection of other land) was not eligible for a federal charitable income tax deduction because it was not “a restriction (granted in perpetuity) on the use which may be made of the real property” as required under law.
Professor Colinvaux was among amici supporting the respondent, the commissioner of the IRS.
Federal income tax law allows a charitable deduction for contributions of conservation easements to an eligible charity, typically a land trust. Easements protect the land from development or secure some conservation value. One of the requirements of the tax code is that the easement be perpetual.
The taxpayers in the Belk case argued that the land protected by the easement could be swapped, post-contribution, with other land. For example, if the original contribution protected Parcel A from development, then after the contribution, the taxpayers (with the cooperation of the land trust) could switch the easement to Parcel B. The taxpayers claimed that there would still be “perpetual” protection for conservation purposes, but just of different land.
The case goes directly to the meaning of “perpetuity” under the tax code. Colinvaux said it was clear to him that Congress intended the tax deduction to protect specific parcels of land, and was not protection in the abstract.
“I got involved because if the taxpayer had prevailed, it would have gutted the perpetuity requirement of meaning, as land once thought to be protected forever could just be changed for other land, ad infinitum,” said Colinvaux.  “Further, the entire deduction is based on the value of an easement with respect to a specific parcel determined at the time of the contribution.”