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§ 9.7 REAL PROPERTY USED FOR CONSERVATION PURPOSES§ 9.7 REAL PROPERTY USED FOR CONSERVATION PURPOSESSpecial federal tax rules pertain to contributions to charity of real property forconservation purposes. These rules are an exception to the general rule thatthere is no charitable contribution deduction for contributions of partial interestsin property. 126 This exception involves the qualified conservation contribution, 127which is the subject of several IRS rulings. 128These rules are in the context of the income tax charitable contributiondeduction for qualified conservation contributions. There are, however,somewhat comparable rules in the estate tax and gift tax charitable deductionsettings. An estate may claim a charitable contribution deduction 129 forthe value of the portion of a conservation easement includible in the estate;individuals claim an income tax charitable deduction for the balance of theeasement. 130A qualified conservation contribution has three fundamental characteristics; itis a contribution• of a qualified real property interest, 131• to a qualified organization, 132• exclusively for conservation purposes. 133The amount allowed as a charitable contribution deduction for a qualifiedconservation easement is the difference between the fair market value of the burdenedproperty 134 before the gift and the value of it following the gift. 135(a) Qualified Real Property InterestsA qualified real property interest is one of the following interests in real property:• The donor’s entire interest in the property other than a qualified mineralinterest 136126 IRC § 170(f)(3)(A). See § 5.3, note 6.127 IRC § 170(f)(3)(B)(iii); Reg. § 1.170A-14(a).128 See, e.g., Priv. Ltr. Rul. 8605008.129 IRC § 2055(f).130 Priv. Ltr. Rul. 200143011,The IRS became aware of instances where a charitable organization purchases real property and places aconservation easement on it, then sells the property subject to the easement for a price that is substantially lessthan the price paid for the property by the organization. The buyer makes a second payment to the organization,claiming it as a charitable contribution. The two payments from the buyer to the charitable organization fullyreimburse the charity for its purchase of the property. The agency stated that it will treat these transactions inaccordance with their substance, by regarding the total of the buyer’s payments to the charity as the buyer’spurchase price for the property and deny the charitable deduction (Notice 2004-41, 2004-28 I.R.B. 31). A trustcannot claim a charitable deduction (nor a distribution deduction; see text accompanied by note 523) for contributionsof trust principal that satisfy the requirements of a qualified conservation contribution. Rev. Rul.2003-123, 2003-50 I.R.B. 1200. See § 9.22.131 IRC § 170(h)(1)(A).132 IRC § 170(h)(1)(B).133 IRC § 170(h)(1)(C).134 See § 10.1(a).135 Symington v. Commissioner, 87 T.C. 893 (1986).136 IRC § 170(h)(2)(A). 285