Georgia landowner claimed $23m tax break; court backs $480,000 valuation
A Georgia landowner claimed a $23 million charitable tax deduction after donating a 103-acre conservation easement, arguing the property could have been used as an aggregate quarry. The US Tax Court rejected the proposed quarry use, valuing the easement at $480,000. The 11th Circuit upheld the valuation and a 40% gross valuation misstatement penalty.
A Georgia landowner, Savannah Shoals, LLC, claimed a $23 million charitable tax deduction for donating a conservation easement on 103 acres of land in Hart County, Georgia. The Internal Revenue Service rejected the claim, imposing a $480,000 valuation and a 40% gross valuation misstatement penalty. The case was brought to the US Appeals Court, which upheld the Tax Court's decision.
The appeals court found that the property's highest and best use was not a quarry, but rather low-density residential or recreational use. The court relied on market demand and competition from other quarries in the area, concluding that quarrying was highly unlikely to be financially feasible.
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