June 23, 2026
Mr. Carey introduced the following bill; which was referred to the Committee on Ways and Means
To provide an election to resolve certain open partnership controversies involving donations of conservation easements.
Section 1. Short title
This Act may be cited as the Historic Preservation and Land Conservation Certainty Act
.
Sec. 2. Election to resolve certain open partnership controversies involving donations of conservation easements
(a) Definitions
For purposes of this section—
(1) Eligible contribution
The term eligible contribution
means any qualified conservation contribution (as defined in section 170(h)(1) of the Internal Revenue Code of 1986) made by a partnership in a taxable year ending on or before December 31, 2024, with respect to which a deduction was claimed under section 170 of such Code on the partnership return for such year. For purposes of this section, such contribution shall be treated as made by the partnership that was the donor of the contributed property for purposes of section 170 of such Code, determined without regard to any agency or nominee arrangement.
(2) Claimed deduction
The term claimed deduction
means the aggregate amount of the deduction with respect to an eligible contribution that was allocable to the ultimate taxpayer partners, as reported on Schedule K–1 or similar statements furnished (directly or indirectly through 1 or more pass-through entities) to such partners for the taxable year in which such deduction is taken into account under section 706(a), section 1366(a), or other applicable provision of the Internal Revenue Code of 1986, including any amendments filed on or before the date the election statement is filed. In determining the claimed deduction, the electing partnership may rely on reported amounts (as amended) unless it has actual knowledge that a different amount was allocable to ultimate taxpayer partners, and may rely on written representations from upper-tier pass-through entities. Any discrepancy between the amount used in the election statement and the actual aggregate amount shall be subject to adjustment under subsection (h), but shall not by itself invalidate the election.
(3) Open matter
The term open matter
means, with respect to any eligible contribution, a contribution with respect to which—
(A)
as of the date the election statement is filed, the period for assessment of any tax imposed by chapter 1 of the Internal Revenue Code of 1986 that is attributable to such contribution has not expired (determined after the application of section 6501 of such Code (including any extension under section 6501(c)(4) of such Code and any suspension under section 6503 of such Code) and, to the extent applicable, section 6229 of such Code (as in effect for partnership taxable years beginning before January 1, 2018) and section 6235 of such Code); or
(B)
the Secretary has issued to the partnership, the applicable partnership representative, or any person authorized to act for the partnership, a written notice or request identifying the partnership, the taxable year, and the contribution (or the conservation easement transaction of which such contribution is a part), indicating review, examination, or proposed adjustment of the Federal income tax treatment thereof, or an administrative appeal or judicial proceeding is pending with respect thereto.
(4) Election period
The term election period
means the 180-day period beginning on the date of enactment of this Act.
(5) Common marketing group
(A) In general
The term common marketing group
means all partnerships with eligible contributions with respect to which the same principal organizer or manager (as defined in subparagraph (B)), even if acting in conjunction with 1 or more other persons, was principally responsible for organizing or managing the plan or arrangement pursuant to which such eligible contributions were solicited, structured, or facilitated, and includes all partnerships with eligible contributions with respect to which any person related (within the meaning of section 267(b) or section 707(b)(1) of the Internal Revenue Code of 1986) to such principal organizer or manager was so principally responsible.
(B) Principal organizer or manager
For purposes of subparagraph (A), a person shall be treated as a principal organizer or manager with respect to an eligible contribution if such person (or any person related to such person within the meaning of section 267(b) or section 707(b)(1) of the Internal Revenue Code of 1986) satisfies any of the following conditions:
(i)
Such person is identified as an organizer, manager, sponsor, promoter, arranger, or similar role in any written offering material, subscription agreement, marketing presentation, partnership agreement, management agreement, side letter, or other written communication provided to any partner or prospective partner in connection with the partnership making the eligible contribution.
(ii)
Such person received, directly or indirectly, or was entitled to receive, any fee, commission, compensation, profit interest, or other economic benefit (other than reimbursement of reasonable out-of-pocket expenses) in connection with organizing, managing, marketing, structuring, facilitating, or arranging financing for the eligible contribution, or for the acquisition, holding, or donation of the property with respect to which the eligible contribution was made.
(iii)
Such person served, directly or indirectly, as a general partner, managing member, manager, trustee, investment manager, or similar controlling person with authority (under governing documents or contract) over the partnership’s acquisition, holding, management, disposition, or donation of the property, or over the decision to make the eligible contribution.
(C) Overlapping groups
If a partnership would be treated as a member of more than 1 common marketing group under this paragraph, all such groups shall be treated as a single common marketing group for purposes of this section.
(6) Designated partnership
The term designated partnership
means the partnership designated under subsection (d)(3).
(7) Electing partnership
The term electing partnership
means the designated partnership (in the case of a common marketing group) or the partnership that made the eligible contribution (in all other cases).
(8) Non-contributing partner
The term non-contributing partner
means any ultimate taxpayer partner identified under subsection (f)(1)(A)(ii).
(9) Election statement
The term election statement
means the written statement filed under subsection (b)(2) that includes the information required under subsection (b)(3).
(10) Applicable partnership representative
The term applicable partnership representative
means the partnership representative designated under section 6223(a) of the Internal Revenue Code of 1986 (for partnership taxable years beginning after December 31, 2017) or the tax matters partner designated under section 6231(a)(7) of such Code (as in effect for partnership taxable years beginning before January 1, 2018).
(11) Pass-through entity
The term pass-through entity
means any partnership, S corporation, estate, or trust.
(12) Ultimate taxpayer partner
The term ultimate taxpayer partner
means, with respect to any portion of a deduction attributable to an eligible contribution, the person that, after taking into account allocations of such portion through one or more pass-through entities, actually takes such portion into account in determining the tax imposed by chapter 1 and receives the Federal income tax benefit of such portion, whether as a partner, shareholder, beneficiary, owner, or otherwise. Except as provided in the preceding sentence, a pass-through entity shall not be treated as an ultimate taxpayer partner. A pass-through entity shall be treated as an ultimate taxpayer partner to the extent such entity is itself subject to tax under chapter 1 and claims the benefit of such portion.
(13) Secretary
The term Secretary
means the Secretary of the Treasury or the Secretary’s delegate.
(b) Election; making election; effect
(1) In general
Notwithstanding any other provision of this title, in the case of any eligible contribution with an open matter, the electing partnership may elect to have this section apply. An election under this section may include only eligible contributions that have an open matter as of the date the election statement is filed.
(2) Making the election
An election under this section shall be made by filing, not later than the last day of the election period, an election statement with the Secretary at the place prescribed under section 6091 of the Internal Revenue Code of 1986 for filing the partnership return of the electing partnership, accompanied by the remittance required under subsection (e)(2). Such remittance shall be in the form of a cashier’s check, certified check, money order, or other check payable to the United States Treasury
, and shall identify the electing partnership and state that it relates to an election under this section.
(3) Required contents of election statement
The election statement shall set forth, with respect to the eligible contribution—
(A)
the name, address, and employer identification number of the electing partnership and, in the case of a common marketing group, the name and employer identification number of each partnership whose eligible contributions are included in the election;
(B)
the taxable year or years of the contributions encompassed by the election;
(C)
identification of each donee and the property, including the date of each eligible contribution;
(D)
the claimed deduction;
(E)
the settlement limitation amount determined under subsection (c);
(F)
the tax component determined under subsection (e)(1)(B);
(G)
the penalty component determined under subsection (e)(1)(C);
(H)
the settlement amount determined under subsection (e)(1)(A); and
(I)
in the case of an electing partnership with a non-contributing partner, the schedule described in subsection (f)(1).
(4) Effect; waiver
If an election under this section becomes effective under paragraph (6)—
(A)
the deduction otherwise allowable under section 170 of the Internal Revenue Code of 1986 for the eligible contribution shall not exceed the settlement limitation amount;
(B)
the settlement amount shall be due and payable as provided in subsection (e);
(C)
except as provided in subsection (f), payment of the settlement amount shall resolve all Federal income tax liability (including penalties and interest) attributable to the excess of the claimed deduction over the settlement limitation amount; and
(D)
the electing partnership, each partner thereof, each pass-through entity through which any portion of the claimed deduction is allocable, and each ultimate taxpayer partner to which any portion of the claimed deduction is allocable waive any right to contest the amounts described in subparagraphs (E), (F), (G), or (H) of paragraph (3), administratively or judicially.
(5) Courtesy notice
Within 10 days of filing an election statement, the electing partnership shall provide a copy thereof to any revenue agent, appeals officer, or chief counsel attorney assigned to the partnership that made the eligible contribution, and to the Clerk of the Tax Court, any United States District Court, or any Court of Appeals in which proceedings involving the eligible contribution are pending. Copies provided to courts shall exclude any schedule described in subsection (f)(1) and shall redact taxpayer identification numbers and street addresses. Failure to provide such notice shall not affect the validity of the election.
(6) Date election becomes effective
An election that satisfies the requirements of this subsection and is accompanied by the required remittance under subsection (e)(2) shall be effective upon filing. No acceptance, acknowledgment, determination, form, regulation, or other administrative action by the Secretary shall be required for the election to be effective. No requirement or procedural step other than those expressly set forth in this section may be imposed as a condition to making or giving effect to an election.
(7) Timely mailing
For purposes of this section, section 7502 of the Internal Revenue Code of 1986 (determined without regard to subsection (f) thereof) shall apply to the election statement, any required schedule or authorization, and any accompanying remittance.
(8) Suspension of limitations
The running of any period of limitation on assessment with respect to any tax attributable to an eligible contribution for which an election becomes effective under paragraph (6) shall be suspended from the date of filing of the election statement until the earlier of 2 years after the date such election becomes effective or the date the election becomes void under subsection (h)(4), and for 90 days thereafter.
(9) Signature; finality
The election statement shall be signed by the applicable partnership representative. An effective election shall be irrevocable and binding on the electing partnership, each partner thereof, each partnership in a common marketing group whose authorization is included under subsection (d)(3), each pass-through entity through which any portion of the claimed deduction is allocable, and each ultimate taxpayer partner to which any portion of the claimed deduction is allocable. Except as expressly provided in subsection (f)(6) and (h)(4), such election shall not be subject to judicial review. Such election shall be treated as a closing agreement under section 7121 with respect to the matters resolved under paragraph (4)(C), and shall be deemed approved by the Secretary under section 7121(b) as of the date the election becomes effective.
(c) Settlement limitation amount
For purposes of this section—
(1) General rule
Except as provided in paragraph (2), the term settlement limitation amount
means an amount equal to 2.5 times the sum of the relevant basis (as defined in section 170(h)(7)(B) of the Internal Revenue Code of 1986) of all partners with respect to the eligible contribution.
(2) Excepted contributions
In the case of an eligible contribution meeting the requirements of subparagraph (C), (D), or (E) of paragraph (7) of the Internal Revenue Code of 1986, the term settlement limitation amount
means an amount equal to 3.2 times the aggregate amount of capital contributed, directly or indirectly, by the ultimate taxpayer partners, excluding any amount derived from a loan, insurance arrangement, or other financing provided by the principal organizer or manager, or by any person related (within the meaning of section 267(b) or section 707(b)(1) of such Code) to such principal organizer or manager.
(d) Aggregation for common marketing groups
(1) Single contribution treatment
All eligible contributions of partnerships in a common marketing group that are described in the election statement and that each has an open matter as of the date the election statement is filed shall be treated as a single eligible contribution for purposes of this section.
(2) Computation on combined basis
In the case of a common marketing group, the claimed deduction, settlement limitation amount, and settlement amount shall be computed by aggregating across all partnerships and all taxable years in the group with respect to the eligible contributions described in the election statement.
(3) Designation and authorizations
A common marketing group shall act through a designated partnership. The designated partnership shall be identified by name and employer identification number in a written authorization executed by the applicable partnership representative of each partnership in the group. Each authorization shall grant filing and remittance authority and acknowledge that the executing partnership is jointly and severally liable for the settlement amount until paid in full.
(4) Validity condition
Except as provided in paragraph (5), an election by a designated partnership shall not be effective unless the election statement includes authorizations from each partnership in the common marketing group.
(5) Effect of final decisions
If 1 or more partnerships in a common marketing group are precluded from electing under subsection (g)(3), the remaining partnerships may make a group election if all partnerships to which subsection (g)(3) does not apply provide authorizations under this paragraph. In any case in which this paragraph applies, paragraph (2) shall be applied by excluding any partnership precluded under subsection (g)(3).
(6) Joint and several liability
Each partnership in a common marketing group shall be jointly and severally liable for the settlement amount until paid in full.
(e) Payment of settlement amount
(1) Settlement amount
For purposes of this section—
(A) In general
The term settlement amount
means the sum of—
(i)
the tax component; and
(ii)
the penalty component.
(B) Tax component
The tax component is equal to the product of—
(i)
the excess of the claimed deduction (the claimed deduction is the combined total amount deducted by all the ultimate taxpayer partners) over the settlement limitation amount; and
(ii)
the highest rate of tax in effect under section 1 of the Internal Revenue Code of 1986 for any taxable year encompassed by the election.
(C) Penalty component
The penalty component is equal to the amount that would be determined under section 6662 of the Internal Revenue Code of 1986 by applying the applicable penalty rate under paragraph (3) to an underpayment equal to the tax component and by treating the settlement limitation amount as the correct amount of the deduction.
(2) Payment
An election partnership shall pay the settlement amount not later than the last day of the election period. Except as provided in subsection (f), an election shall not be effective unless the electing partnership remits the full settlement amount with the election statement.
(3) Applicable penalty rate
The applicable penalty rate shall be—
(A)
the rate applicable under section 6662(h) of the Internal Revenue Code of 1986 in any case in which the claimed deduction exceeded 200 percent of the settlement limitation amount; and
(B)
the rate applicable under section 6662(a) of such Code in any other case the application of the rate under the preceding sentence shall be determined without regard to section 6664(c) of the Internal Revenue Code of 1986.
(4) Interest waiver
In the case of any portion of the settlement amount remitted by the electing partnership not later than the last day of the election period, any interest under section 6601 of the Internal Revenue Code of 1986 with respect to such portion for periods ending before the date of remittance is waived. Interest shall accrue in full on any amount not so remitted.
(5) Assessment and collection
Any settlement amount (and any amount assessed under subsection (f)) shall be assessed and collected in the same manner as tax imposed by chapter 1 of the Internal Revenue Code of 1986. The Secretary shall accept and apply any remittance as a payment of the settlement amount without any receipt, notice, or administrative action affecting the effectiveness of the election.
(f) Non-Contributing partners
(1) Identification of non-contributing partners
(A) In general
If the electing partnership does not remit the full settlement amount solely because one or more ultimate taxpayer partners fail to provide their respective allocable amounts, the election statement shall include a schedule identifying—
(i)
each ultimate taxpayer partner who has contributed such partner’s allocable amount;
(ii)
each ultimate taxpayer partner who has not contributed such partner’s allocable amount; and
(iii)
the following information for each partner described in clauses (i) and (ii):
(I)
The name, current address, taxpayer identification number of such partner.
(II)
The amount described in subparagraph (B)(i) with respect to such partner.
(III)
The allocable amount for such partner.
(B) Allocable amount
For purposes of this subsection, a partner’s allocable amount is equal to the product of the settlement amount and a fraction—
(i)
the numerator of which is such partner’s share of the deduction (as reported on the Schedule K–1 or similar statement, including amendments filed before the date the election statement is filed); and
(ii)
the denominator of which is the total claimed deduction.
(2) Reduced remittance
In the case of an election statement including a schedule under paragraph (1), the amount of the remittance required under subsection (e)(2) shall be reduced by the aggregate allocable amounts of non-contributing partners.
(3) Assessment against non-contributing partners
The Secretary shall assess against each non-contributing partner an amount equal to the sum of—
(A)
such partner’s allocable amount, and
(B)
an amount equal to 25 percent of the product of the tax component determined under subsection (e)(1)(B) and the fraction described in paragraph (1)(B).
Such amount shall be payable upon notice and demand.
(4) Interest
Interest under section 6601 of the Internal Revenue Code of 1986 shall accrue on any amount assessed under this subsection beginning on the day after the last day of the election period.
(5) Period of limitations
For purposes of section 6501 of the Internal Revenue Code of 1986, the period for assessment of any amount under this subsection shall not expire before 3 years after the last day of the election period.
(6) Assessment procedures; judicial review
Amounts assessed under paragraph (3) shall be immediately assessable, and the restrictions under section 6213(a) of the Internal Revenue Code of 1986 on assessment and collection shall not apply. A non-contributing partner may contest the computation of such partner’s allocable amount only by paying the amount assessed and filing a claim for refund under section 6511 of such Code. Nothing in this subsection shall limit a non-contributing partner’s right to bring suit under section 7422 of such Code following disallowance of such claim.
(g) Coordination with prior proceedings
(1) Prior settlements
If a partnership has entered into a closing agreement under section 7121 of the Internal Revenue Code of 1986 or a compromise under section 7122 of such Code with respect to an eligible contribution, the partnership shall exclude from the election any matters resolved thereby.
(2) Pending stipulated decisions
A partnership with respect to which a stipulated decision has been lodged with the Tax Court but not yet entered may withdraw such stipulation and make an election, provided that such withdrawal occurs before the last day of the election period.
(3) Final decisions
No election may be made with respect to an eligible contribution if a decision of the Tax Court has become final within the meaning of section 7481 of the Internal Revenue Code of 1986, or if a judgment of any other court has become final and is no longer subject to review (including by petition for writ of certiorari).
(4) Section 6226 elections
If a partnership has made an election under section 6226 of the Internal Revenue Code of 1986 with respect to an imputed underpayment attributable to an eligible contribution, an election under this section may be made only if such election under section 6226 of such Code is revoked. Notwithstanding section 6226 of such Code and any regulations thereunder, such revocation shall be made by a written statement signed by the applicable partnership representative and included with the election statement, and shall be effective solely with respect to the eligible contribution and items attributable thereto.
(h) Examination for computational accuracy
(1) Authority
Notwithstanding subsection (b)(4), the Secretary may examine any election solely to verify the correctness of computational elements, including the claimed deduction, relevant basis or capital contributions, settlement limitation amount, tax component, and penalty component. Such examination shall not extend to any determination of fair market value or any other substantive issue resolved by the election.
(2) Adjustment for discrepancy
If the Secretary determines that the settlement amount was incorrectly computed, the Secretary shall notify the electing partnership of such discrepancy and the corrected amount by mailing notice to the last known address of such partnership. Except as provided in subsection (h)(3) and (h)(4), any additional amount due shall be payable within 90 days of such notification.
(3) Administrative review
If, within the 90-day period described in subsection (h)(2) the electing partnership files a written protest or request for administrative review of all or any portion of the additional amount, the Secretary shall provide administrative review, including review by the Independent Office of Appeals if otherwise available. Assessment and collection of the disputed portion shall be suspended while such administrative review is pending. Upon conclusion of such review, the Secretary shall mail to the electing partnership a notice of final administrative determination setting forth the amount, if any, finally determined by the Secretary.
(4) Judicial review
The electing partnership may contest the computation of any additional amount determined under this subparagraph by filing a petition with the Tax Court without prior payment or, after payment, by filing a claim for refund under section 6511. Any petition to the Tax Court shall be filed within 90 days after the Secretary mails the notice described in clause (ii), or, if administrative review is timely requested under clause (iii), within 90 days after the Secretary mails the notice of final administrative determination. The Tax Court shall have jurisdiction over any timely petition filed under this clause, notwithstanding that the electing partnership is not otherwise liable for tax under this title, and may redetermine the correct amount of the disputed additional amount, but only with respect to the computational elements described in clause (i). No assessment, levy, or proceeding in court for collection of the disputed portion shall be made, begun, or prosecuted until the expiration of the applicable 90-day period, or, if a petition is timely filed, until the decision of the Tax Court has become final under section 7481. Nothing in this paragraph shall be construed to limit the electing partnership’s right to bring suit under section 7422 following disallowance of such claim.
(5) Effect on election
No election shall be void or otherwise impaired solely because the electing partnership exercises its rights under (h)(3) or (h)(4). The election shall remain in effect pending any administrative review, Tax Court proceeding, or refund claim or suit. If any additional amount finally determined under this subparagraph is paid within 90 days after the close of the applicable 90-day period described (h)(4) if no petition is filed, or within 90 days after the decision of the Tax Court becomes final, the election shall remain in effect at the corrected settlement amount, and no further liability (other than interest under section 6601 on the additional amount from the last day of the election period) shall arise from such adjustment.
(6) Election void
The election shall be void from the beginning only if—
(A)
the additional amount is not paid within the 90-day period; and
(B)
the electing partnership does not contest the Secretary’s determination administratively or judicially under (h)(4) or (h)(5).
(7) Effect of voided election
If an election becomes void under paragraph (6), any amounts previously remitted shall be treated as a payment of tax and applied against any liability subsequently determined with respect to the eligible contribution.
(8) Time limit
The Secretary may not provide notification under paragraph (2) after the date that is 2 years after the date the election becomes effective under subsection (b)(6).
(i) No inference; preservation of other remedies
Nothing in this section shall be construed to create any inference regarding the proper tax treatment or fair market value of any eligible contribution for which an election is not made under this section. Nothing in this section shall limit or affect any penalty under section 6694, 6695, 6700, 6701, or any other provision of the Internal Revenue Code of 1986 applicable to any person other than the electing partnership or its partners.
Sec. 3. Contributing-building standard for certain qualified conservation contributions and certified historic structures
(a) Amendment to section 170(h)(4)(c)
Section 170(h)(4)(C) is amended—
(1)
in clause (ii), by striking and is certified by the Secretary of the Interior to the Secretary as being of historic significance to the district
and inserting and is a contributing building
; and
(2)
by inserting after clause (ii) the following flush language: For purposes of clause (ii), the term
contributing building
means any building that—
(I)
is identified as contributing in the National Register nomination for the district, any amendment thereto, or the official map, inventory, or other district documentation on file with, or approved or accepted by, the Secretary of the Interior, or
(b) Conforming amendment to section 47(c)(3)(a)
Section 47(c)(3)(A) is amended—
(1)
in clause (ii), by striking and is certified by the Secretary of the Interior to the Secretary as being of historic significance to the district
and inserting and is a contributing building
; and
(2)
by inserting after clause (ii) the following flush language: For purposes of clause (ii), the term
contributing building
means any building that—
(I)
is identified as contributing in the National Register nomination for the district, any amendment thereto, or the official map, inventory, or other district documentation on file with, or approved or accepted by, the Secretary of the Interior, or
(II)
is certified by the Secretary of the Interior to the Secretary as contributing to the historic significance of the district.
(c) Conforming amendment to section 47(c)(3)(b)(ii)(i)
Section 47(c)(3)(B)(ii)(I) is amended by striking buildings of historic significance to the district
and inserting contributing buildings in the district
.
(d) Effective dates
(1) Section 170 amendment
The amendments made by subsection (a) shall apply to contributions made in taxable years ending before, on, or after the date of enactment, but only with respect to—
(A)
any taxable year for which the period for assessment under section 6501 has not expired as of such date;
(B)
any taxable year for which a claim for credit or refund may be filed under section 6511 as of such date;
(C)
any taxable year to which a deduction attributable to such contribution is carried under section 170(d) and for which the period described in subparagraph (A) or (B) remains open; or
(D)
any administrative or judicial proceeding with respect to such contribution that is pending and not final as of such date.
(2) Section 47 conforming amendments
The amendments made by subsections (b) and (c) shall apply to taxable years beginning after the date of enactment.
(3) No inference
No inference shall be drawn with respect to any taxable year or proceeding closed by operation of law.