HR 2263 IH
106th CONGRESS
1st Session
H. R. 2263
To amend the Internal Revenue Code of 1986 to encourage contributions
by individuals of capital gain real property for conservation purposes, to
encourage qualified conservation contributions, and to modify the rules
governing the estate tax exclusion for land subject to a qualified conservation
easement.
IN THE HOUSE OF REPRESENTATIVES
June 17, 1999
Mrs. JOHNSON of Connecticut (for herself, Mr. BLUMENAUER, Mr. BEREUTER, and
Mr. MALONEY of Connecticut) introduced the following bill; which was referred to
the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to encourage contributions
by individuals of capital gain real property for conservation purposes, to
encourage qualified conservation contributions, and to modify the rules
governing the estate tax exclusion for land subject to a qualified conservation
easement.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
H.L.C.
.....................................................................
(Original Signature of Member)
106th CONGRESS
1st Session
H. R. XX
IN THE HOUSE OF REPRESENTATIVES
Mrs. JOHNSON of Connecticut introduced the following bill; which was referred
to the Committee on XXXXXXXXXXXXXXX
A BILL
To amend the Internal Revenue Code of 1986 to encourage contributions
by individuals of capital gain real property for conservation purposes, to
encourage qualified conservation contributions, and to modify the rules
governing the estate tax exclusion for land subject to a qualified conservation
easement.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. MODIFICATIONS TO ENCOURAGE CONTRIBUTIONS OF CAPITAL GAIN REAL
PROPERTY MADE FOR CONSERVATION PURPOSES AND QUALIFIED CONSERVATION
CONTRIBUTIONS.
(a) CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY MADE FOR CONSERVATION
PURPOSES AND OF QUALIFIED CONSERVATION CONTRIBUTIONS NOT SUBJECT TO SPECIAL
LIMITATION ON CONTRIBUTIONS OF CAPITAL GAIN PROPERTY- Subparagraph (C) of
section 170(b)(1) of the Internal Revenue Code of 1986 (relating to special
limitation with respect to contributions described in subparagraph (A) of
capital gain property) is amended by redesignating clause (iv) as clause (v)
and by inserting after clause (iii) the following new clause:
`(iv) In the case of charitable contributions described in
subparagraph (A) of capital gain property, clauses (i) and (ii) shall
not apply to--
`(I) any qualified conservation contribution (as defined in
section 170(h)), or
`(II) any other contribution of capital gain property which is
real property if the contribution is of the donor's entire interest in
such property and is to a qualified organization (as defined in
section 170(h)(3)) which is organized for conservation purposes (as
defined in section 170(h)(4)(A)) and which provides the taxpayer, at
the time of such donation, a letter of intent which contains an
acknowledgment of the donee's intent that the property is being
acquired for any such conservation purpose.'.
(b) UNLIMITED CARRYOVER FOR CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY
FOR CONSERVATION PURPOSES AND OF QUALIFIED CONSERVATION CONTRIBUTIONS OF
CAPITAL GAIN PROPERTY- Paragraph (1) of section 170(d) of such Code in amended
by adding at the end the following new subparagraph:
`(C) UNLIMITED CARRYOVER FOR CONTRIBUTIONS OF CAPITAL GAIN REAL
PROPERTY FOR CONSERVATION PURPOSES AND OF QUALIFIED CONSERVATION
CONTRIBUTIONS OF CAPITAL GAIN PROPERTY- The 5 taxable year limitation in
subparagraph (A) shall not apply to any charitable contribution to which
clauses (i) and (ii) of subsection (b)(1)(C) do not apply by reason of
clause (iv) thereof. For purposes of this paragraph, the excess described
in the material preceding clause (i) of subparagraph (A) shall be treated
as attributable to contributions described in the preceding sentence of
this subparagraph to the extent of such contributions.'.
(c) EFFECTIVE DATE- The amendment made by this section shall apply to
contributions made in taxable years beginning after the date of the enactment
of this Act.
SEC. 2. MODIFICATION OF RULES RELATING TO ESTATE TAX EXCLUSION FOR LAND
SUBJECT TO QUALIFIED CONSERVATION EASEMENT.
(a) REPEAL OF CERTAIN RESTRICTIONS ON WHERE LAND IS LOCATED- Clause (i) of
section 2031(c)(8)(A) of the Internal Revenue Code of 1986 is amended to read
as follows:
`(i) which is located in the United States or any possession of the
United States,'.
(b) REPEAL OF LIMITATION ON EXCLUSION-
(1) IN GENERAL- Paragraph (1) of section 2031(c) of such Code is amended
by striking `the lesser of--' and all that follows and inserting `the
applicable percentage of the value of land subject to a qualified
conservation easement, reduced by the
amount of any deduction under section 2055(f) with respect to such land.'
(2) CONFORMING AMENDMENTS-
(A) Subsection (c) of section 2031 of such Code is amended by striking
paragraph (3) and by redesignating paragraphs (4) through (10) as
paragraphs (3) through (9), respectively.
(B) Paragraphs (2) and (6) of section 2031(c) of such Code, as
redesignated by subparagraph (A), are each amended by striking `paragraph
(5)' and inserting `paragraph (4)'.
(C) Paragraphs (1), (6), and (7)(A)(iii) of section 2031(c) of such
Code, as redesignated by subparagraph (A), are each amended by striking
`paragraph (6)' and inserting `paragraph (5)'.
(c) DATE FOR DETERMINING VALUE OF LAND AND EASEMENT- Paragraph (2) of
section 2032(c) of such Code (defining applicable percentage) is amended by
adding at the end the following new sentence: `The values taken into account
under the preceding sentence shall be such values as of the date of the
contribution referred to in paragraph (7)(B).'
(d) CERTAIN COMMERCIAL RECREATIONAL USES PERMITTED- Subparagraph (B) of
section 2031(c)(7) of such Code, as redesignated by subsection (b), is amended
to read as follows:
`(B) QUALIFIED CONSERVATION EASEMENT-
`(i) IN GENERAL- The term `qualified conservation easement' means a
qualified conservation contribution (as defined in section 170(h)(1)) of
a qualified real property interest (as defined in section 170(h)(2)(C)),
except that clause (iv) of section 170(h)(4)(A) shall not apply, and the
restriction on the use of such interest described in section
170(h)(2)(C) shall include a prohibition on more than a de minimis use
for a commercial recreational activity.
`(ii) SPECIAL RULES- For purposes of this paragraph--
`(I) RETAINED RIGHTS- Rights retained in the conservation easement
to lease the land for hunting and fishing, so long as such leases are
not inconsistent with the conservation purpose of the easement, shall
be deemed to be de minimis use.
`(II) PRE-EFFECTIVE DATE EASEMENTS- Easements otherwise qualifying
under the provisions of this subsection that were donated on or before
the date of the enactment of this subclause, shall be deemed to allow
no more than de minimis use for a commercial recreational activity
unless by their terms they expressly provide for commercial
recreational activity in excess of that otherwise allowed by this
subparagraph.
`(III) AUTHORITY TO EXTINGUISH RIGHT OF COMMERCIAL RECREATION
ACTIVITY- For purposes of this section, if the executor of an estate
and every person in being who has an interest in the land execute an
agreement to amend or extinguish any right under the easement of
commercial recreation activity in the land so as to ensure that such
land is used for no more than de minimis commercial recreational
activity, such agreement shall be treated as in effect as of the date
of the election described in paragraph (5).'
(e) EXCLUSION APPLICABLE TO SOLD EASEMENTS- Clause (i) of section
2031(c)(7) of such Code, as amended by subsection (d), is amended by adding at
the end the following new sentence: `A transfer for value of a qualified real
property interest (as defined under section 170(h)(2)(C)) shall not fail to be
treated as a qualified conservation easement if such interest would meet the
requirements of the preceding sentence were it donated to the purchaser and
any reference in this section to a contribution shall be treated as including
a reference to such a transfer.'
(f) EFFECTIVE DATE- The amendments made by this section shall take effect
as if included in the amendments made by section 508 of the Taxpayer Relief
Act of 1997.
END