I
107TH CONGRESS
1ST SESSION
H. R. 1309
To amend the Internal Revenue Code of 1986 to encourage contributions
by individuals of capital gain real property for conservation purposes,
to encourage qualified conservation contributions, and to modify the
rules governing the estate tax exclusion for land subject to a qualified
conservation easement.
IN THE HOUSE OF REPRESENTATIVES
MARCH 29, 2001
Mr. JOHNSON of Connecticut (for herself, Mr. BLUMENAUER, Mrs. WILSON,
Mr. MCGOVERN, Mr. SIMMONS, Mr. GEORGE MILLER of Caliifornia, Ms.
MCKINNEY, Mr. FATTAH, Mr. ABERCROMBIE, and Mr. MALONEY of Con-
necticut) introduced the following bill; which was referred to the Com-
mittee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to encourage
contributions by individuals of capital gain real property
for conservation purposes, to encourage qualified con-
servation contributions, and to modify the rules gov-
erning the estate tax exclusion for land subject to a
qualified conservation easement.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. MODIFICATIONS TO ENCOURAGE CONTRIBU-
TIONS OF CAPITAL GAIN REAL PROPERTY
MADE FOR CONSERVATION PURPOSES AND
QUALIFIED CONSERVATION CONTRIBUTIONS.
(a) CONTRIBUTIONS OF CAPITAL GAIN REAL PROP-
ERTY MADE
FOR CONSERVATION PURPOSES
AND
OF
QUALIFIED CONSERVATION CONTRIBUTIONS NOT SUB-
JECT TO SPECIAL LIMITATION ON CONTRIBUTIONS OF
CAPITAL GAIN PROPERTY.—Subparagraph (C) of section
170(b)(1) of the Internal Revenue Code of 1986 (relating
to special limitation with respect to contributions de-
scribed in subparagraph (A) of capital gain property) is
amended by redesignating clause (iv) as clause (v) and by
inserting after clause (iii) the following new clause:
‘‘(iv) In the case of charitable con-
tributions described in subparagraph (A)
of capital gain property, clauses (i) and (ii)
shall not apply to—
‘‘(I) any qualified conservation
contribution (as defined in section
170(h)), or
‘‘(II) any other contribution of
capital gain property which is real
property if the contribution is of the
donor’s entire interest in such prop-
erty and is to a qualified organization
(as defined in section 170(h)(3))
which is organized for conservation
purposes 
(as 
defined 
in 
section
170(h)(4)(A)) and which provides the
taxpayer, at the time of such dona-
tion, a letter of intent which contains
an acknowledgment of the donee’s in-
tent that the property is being ac-
quired for any such conservation pur-
pose.’’.
(b) UNLIMITED CARRYOVER FOR CONTRIBUTIONS OF
CAPITAL GAIN REAL PROPERTY
FOR CONSERVATION
PURPOSES
AND
OF QUALIFIED CONSERVATION CON-
TRIBUTIONS OF CAPITAL GAIN PROPERTY.—Paragraph
(1) of section 170(d) of such Code in amended by adding
at the end the following new subparagraph:
‘‘(C) UNLIMITED
CARRYOVER
FOR
CON-
TRIBUTIONS OF CAPITAL GAIN REAL PROPERTY
FOR CONSERVATION PURPOSES AND OF QUALI-
FIED CONSERVATION CONTRIBUTIONS OF CAP-
ITAL GAIN PROPERTY.—The 5 taxable year lim-
itation in subparagraph (A) shall not apply to
any charitable contribution to which clauses (i)
and (ii) of subsection (b)(1)(C) do not apply by
reason of clause (iv) thereof. For purposes of
this paragraph, the excess described in the ma-
terial preceding clause (i) of subparagraph (A)
shall be treated as attributable to contributions
described in the preceding sentence of this sub-
paragraph to the extent of such contributions.’’.
(c) EFFECTIVE DATE.—The amendment made by
this section shall apply to contributions made in taxable
years beginning after the date of the enactment of this
Act.
SEC. 2. MODIFICATION OF RULES RELATING TO ESTATE
TAX EXCLUSION FOR LAND SUBJECT TO
QUALIFIED CONSERVATION EASEMENT.
(a) REPEAL OF CERTAIN RESTRICTIONS ON WHERE
LAND IS LOCATED.—Clause (i) of section 2031(c)(8)(A)
of the Internal Revenue Code of 1986 is amended to read
as follows:
‘‘(i) which is located in the United
States or any possession of the United
States,’’.
(b) REPEAL OF LIMITATION ON EXCLUSION.—
(1) IN
GENERAL.—Paragraph (1) of section
2031(c) of such Code is amended by striking ‘‘the
lesser of—’’ and all that follows and inserting ‘‘the
applicable percentage of the value of land subject to
a qualified conservation easement, reduced by the
amount of any deduction under section 2055(f) with
respect to such land.’’
(2) CONFORMING AMENDMENTS.—
(A) Subsection (c) of section 2031 of such
Code is amended by striking paragraph (3) and
by redesignating paragraphs (4) through (10)
as paragraphs (3) through (9), respectively.
(B) Paragraphs (2) and (6) of section
2031(c) of such Code, as redesignated by sub-
paragraph (A), are each amended by striking
‘‘paragraph (5)’’ and inserting ‘‘paragraph
(4)’’.
(C) Paragraphs (1), (6), and (7)(A)(iii) of
section 2031(c) of such Code, as redesignated
by subparagraph (A), are each amended by
striking ‘‘paragraph (6)’’ and inserting ‘‘para-
graph (5)’’.
(c) DATE FOR DETERMINING VALUE OF LAND AND
EASEMENT.—Paragraph (2) of section 2032(c) of such
Code (defining applicable percentage) is amended by add-
ing at the end the following new sentence: ‘‘The values
taken into account under the preceding sentence shall be
such values as of the date of the contribution referred to
in paragraph (7)(B).’’
(d) CERTAIN COMMERCIAL RECREATIONAL USES
PERMITTED.—Subparagraph (B) of section 2031(c)(7) of
such Code, as redesignated by subsection (b), is amended
to read as follows:
‘‘(B) QUALIFIED
CONSERVATION
EASE-
MENT.—
‘‘(i) IN GENERAL.—The term ‘quali-
fied conservation easement’ means a quali-
fied conservation contribution (as defined
in section 170(h)(1)) of a qualified real
property interest (as defined in section
170(h)(2)(C)), except that clause (iv) of
section 170(h)(4)(A) shall not apply, and
the restriction on the use of such interest
described in section 170(h)(2)(C) shall in-
clude a prohibition on more than a de
minimis use for a commercial recreational
activity.
‘‘(ii) SPECIAL RULES.—For purposes
of this paragraph—
‘‘(I) RETAINED RIGHTS.—Rights
retained in the conservation easement
to lease the land for hunting and fish-
ing, so long as such leases are not in-
consistent with the conservation pur-
recreational activity, such agreement
shall be treated as in effect as of the
date of the election described in para-
graph (5).’’
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to estates of decedents dying after
the date of the enactment of this Act.
Æ