Whitehouse Hotel Limited Partnership, Qhr Holdings II
About This Legal Opinion
Fifth Circuit upheld the Tax Court in finding that the IRS appraiser was qualified and that the IRS appraiser's failure to comply with USPAP did not render his testimony and report inadmissible but reversed on valuation and penalties.
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Whitehouse Hotel Limited Partnership et al. v. Commissioner
Whitehouse I Holding: The Tax Court held that IRS' expert witness was qualified, an expert witness' failure to follow USPAP does not render his testimony inadmissible under the Federal Rules of Evidence, rejected the use of the replacement cost approach and the income approach to valuation, applied its own valuation and penalties.
Whitehouse Hotel Limited Partnership, Qhr Holdings III
In a 97-page opinion, the Tax Court doubled down on its initial conclusions in Whitehouse I on just about every point. This is detailed opinion is summaried in the long description.
Evans v. Commissioner
The taxpayer failed to meet the burden of proof on valuation so the IRS' zero valuation was sustained. The Court declined to assess the accuracy-related penalty, finding that the original appraisal was qualified, that taxpayer had reasonable cause and acted in good faith reliance on the appraiser.
The Art of Appraisals
The art of appraising conservation land can be complicated, and a land trust must make sure the appraiser is qualified. This document provides an overview of what is involved in an appraisal, how to find a qualified appraiser and pertinent questions to ask an appraiser.
Butler v. Commissioner of IRS
The Tax Court found for the taxpayers on the conservation purposes and reserved rights issues and reduced the valuation by 50% but did not assess penalties.
Schmidt v. Commissioner
This opinion wades into the weeds of the valuation analysis. The Tax Court found fault with aspects of the taxpayer appraiser's methodology and conclusions, the appraiser had extensive experience with conservation easements helped the taxpayer avoid any appraisal penalties.
Bosque Canyon Ranch, L.P. v. Commissioner
The Tax Court ruled for the IRS in all respects following Belk and assessed gross valuation misstatement penalties. In a 2-to-1 split decision, the Fifth Circuit reversed and remanded. This important case limited the reach of Belk and Balsam Mountain.
Hiring an Appraiser
One of the first steps in securing a sound appraisal is for the landowner to hire a knowledgeable and competent appraiser. In addition to securing the services of a good appraiser, it is important that the land trust stay in close contact with him or her throughout the valuation process.
Graev v. Commissioner
The Tax Court held for the IRS, finding that the cash and easement gifts were rendered conditional by the side letter, and that the possibility that the IRS would disallow the deductions was not 'so remote as to be negligible.' Tax Court upheld a 20% overvaluation penalty .
Bruzewicz v. United States tax court opinion
The District Court ruled for the IRS on summary judgment, holding that the failure to comply with I.R.C. § 170(f)(8) was, in and of itself, fatal to the deduction claim. The court rejected substantial compliance.