Sponsor
Mike Carey
Representative · R-OH
Representative · R-OH
The bill speeds resolution of certain conservation-easement disputes and simplifies historic-district tax treatment, reducing administrative burdens, but forces often-costly, irrevocable settlements that limit partners' rights and may increase audits and federal revenue loss.
Partnerships with disputed conservation-easement deductions can obtain finality quickly by making a one-time election and paying a defined settlement amount, removing prolonged uncertainty and closing IRS disputes for those cases.
Owners and donors of buildings in listed historic districts can more easily claim conservation deductions and rehabilitation tax credits by relying on existing 'contributing building' designations and National Register documentation, reducing the need for new federal certifications and administrative delays.
For electing partnerships, IRS review of substantive valuation issues is limited to computational verification, simplifying administration and reducing the risk of prolonged substantive disputes.
Non‑contributing partners and other partners can be assessed joint and several liability and face accelerated collection with limited pre-payment contest rights, exposing some partners to substantial unexpected tax and collections risk.
The election is irrevocable and largely not subject to judicial review, significantly restricting partners' ability to contest substantive tax treatment or valuation after electing.
Partnerships must pay a potentially large, up‑front settlement (based on multipliers of basis or capital) to make the election, increasing immediate cash burdens on partners and possibly forcing asset sales or liquidity strains.
Based on analysis of 3 sections of legislative text.
Creates a 180-day elective process for resolving partnership conservation-easement disputes (years through 2024) and replaces a Secretary-certification test with a documentary "contributing building" standard for certain conservation deductions and rehabilitation credits.
Official title: To provide an election to resolve certain open partnership controversies involving donations of conservation easements.
Introduced June 23, 2026 by Mike Carey · Last progress June 23, 2026
Creates an elective process allowing partnerships to resolve certain open IRS disputes about partnership charitable deductions for conservation easements donated in partnership years ending on or before December 31, 2024, with objective definitions of eligible contributions, claimed deductions, open matters, common marketing groups, and principal organizers/managers. Changes the tax-law test for certain historic-district conservation deductions and rehabilitation tax credits by replacing a Secretary-of-the-Interior certification requirement with a narrower, documentary "contributing building" standard and limits the reach of those changes to open tax years or to post-enactment years as specified. The bill aims to provide faster, predictable dispute resolution for partnership-level easement claims and to clarify which buildings qualify for historic-district related deductions and credits, while preserving closed and finally resolved tax years and cases from reopening under the new standards.