IRS Notice 2017-29: Disclosure Deadline Extended for Participants in Syndicated Conservation Easements

Doug Image CroppedThe IRS recently issued Notice 2017-29, which extends the deadline for participants in syndicated conservation easements to make their discosure (as required in Notice 2017-10),  from June 21, 2017 to October 2, 2017. Notably, it does not extend the May 2nd deadline for material advisors and participants under Treas. Reg. 1.6011-4(e)(1). If you have questions about the new IRS scrutiny on conservation easements and the listed transaction/tax shelter rules, we can help. For more information please contact us at 404-255-7400 or info@hoffmanestatelaw.com.

The IRS has provided participants in syndicated conservation easement transactions additional time to meet their disclosure obligations. The due date for filing disclosures has been extended from June 21, 2017, to October 2, 2017. On December 23, 2016, the IRS released Notice 2017-10, I.R.B. 2017-4, 544, which identified syndicated conservation easement transactions and substantially similar transactions as listed transaction for purposes of Reg. §1.6011-4(b)(2). That notice provided that a participant with a disclosure obligation had until June 21, 2017, to submit the disclosure to the IRS Office of Tax Shelter Analysis. However, the due date for disclosure by material advisors and participants who have disclosure obligations under Reg. §1.6011-4(e)(1) remains unchanged. Those disclosures must be filed by May 1, 2017. Finally, the new notice also provides that, for purposes of Notice 2017-10, a donee described in Code Sec. 170(c) is not a material advisor under Code Sec. 6111. Notice 2017-10, I.R.B. 2017-4, 544, is modified.

On December 23, 2016, the IRS released Notice 2017-10, 2017-4 IRB 544, identifying syndicated conservation easement transactions described in section 2 of that notice and substantially similar transactions as listed transactions for purposes of §1.6011-4(b)(2) of the Income Tax Regulations and §§6111 and 6112 of the Internal Revenue Code. Section 3 of Notice 2017-10 provides that in the case of a participant with a disclosure obligation with respect to these transactions under §1.6011-4(e)(2)(i) (regarding subsequently listed transactions), the disclosure is due to the IRS Office of Tax Shelter Analysis on June 21, 2017. In response to requests for additional time for participants to meet the disclosure obligation with respect to these transactions under §1.6011-4(e)(2)(i), this notice extends the due date for participants filing disclosures under §1.6011-4(e)(2)(i) from June 21, 2017, until October 2, 2017.

The due date for disclosure by material advisors under §301.6111-3(e) and participants who have disclosure obligations under §1.6011-4(e)(1) (regarding returns filed after December 23, 2016) with respect to the transaction described in section 2 of Notice 2017-10 is unchanged by this notice and remains May 1, 2017.