I
107TH CONGRESS
1ST SESSION
H. R. 2279
To amend the Internal Revenue Code of 1986 to provide special rules for
the charitable deduction for conservation contributions of land by eligible
farmers and ranchers, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JUNE 21, 2001
Mr. HEFLEY introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to provide
special rules for the charitable deduction for conservation
contributions of land by eligible farmers and ranchers,
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Rural Heritage Con-
servation Act’’.
SEC. 2. SPECIAL LIMITATION FOR CERTAIN CHARITABLE
CONTRIBUTIONS OF ELIGIBLE FARMERS AND
RANCHERS.
(a) IN GENERAL.—Section 170(b)(1) of the Internal
Revenue Code of 1986 (relating to percentage limitations
of individuals) is amended by redesignating subparagraph
(F) as subparagraph (G) and inserting after subparagraph
(E) the following:
‘‘(F) SPECIAL LIMITATION WITH RESPECT
TO
CONTRIBUTIONS
DESCRIBED
IN
SUBPARA-
GRAPH (A) OF CAPITAL GAIN PROPERTY BY ELI-
GIBLE FARMERS OR RANCHERS.—
‘‘(i) IN
GENERAL.—Notwithstanding
subparagraph (C), in the case of a chari-
table contribution described in subpara-
graph (A) of capital gain property (as de-
fined in subparagraph (C)) of an eligible
farmer or rancher who makes an election
under clause (ii), the total amount of con-
tributions of such property which may be
taken into account under subsection (a) for
any taxable year shall not exceed 100 per-
cent of the taxpayer’s contribution base for
such year. For purposes of this subsection,
contributions of capital gain property to
which this subparagraph applies shall be
taken into account after all other chari-
table contributions.
‘‘(ii) ELECTION.—
‘‘(I) IN
GENERAL.—A taxpayer
may make an election under this
clause to take the deduction under
subsection (a) for any contribution de-
scribed in clause (i) for a 15-consecu-
tive-taxable-year period.
‘‘(II) EFFECT OF ELECTION.—A
taxpayer may only make 1 election
under this clause. Such election, once
made, shall be irrevocable.
‘‘(iii) ELIGIBLE FARMER OR RANCH-
ER.—For purposes of this subparagraph,
the term ‘eligible farmer or rancher’ means
a taxpayer—
‘‘(I) whose gross income from the
trade or business of farming (within
the meaning of section 2032A(e)(5))
is at least 51 percent of the taxpayer’s
gross income for the taxable year, and
‘‘(II) in the case of a C corpora-
tion, the stock of which is not publicly
traded on a recognized exchange.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 170(b)(1)(C)(i) of the Internal Rev-
enue Code of 1986 is amended by inserting ‘‘or (E)’’
after ‘‘subparagraph (D)’’.
(2) 
The 
second 
sentence 
of 
section
170(b)(1)(D) of such Code is amended by inserting
‘‘(other than charitable contributions to which sub-
paragraph (F) applies)’’ before the period.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to contributions made in taxable
years beginning after the date of the enactment of this
Act.
SEC. 3. MODIFICATIONS TO ENCOURAGE CONTRIBUTIONS
OF CAPITAL GAIN REAL PROPERTY MADE
FOR CONSERVATION PURPOSES.
(a) EXCLUSION FROM PERCENTAGE LIMITATION.—
Section 170(b)(1)(C) of the Internal Revenue Code of
1986 (relating to special limitation with respect to con-
tributions described in subparagraph (A) of capital gain
property) is amended by redesignating clause (iv) as
clause (v) and by inserting after clause (iii) the following:
‘‘(iv) Clauses (i) and (ii) shall not
apply to a contribution of capital gain
property which is a qualified conservation
contribution (as defined in subsection
(h)).’’.
(b) UNLIMITED CARRYOVER
FOR CERTAIN CON-
SERVATION CONTRIBUTIONS
OF CAPITAL GAIN PROP-
ERTY.—Paragraph (1) of section 170(d) of the Internal
Revenue Code of 1986 (relating to carryover of excess con-
tributions) is amended by adding at the end the following:
‘‘(C) UNLIMITED
CARRYOVER
FOR
CER-
TAIN
CONSERVATION
CONTRIBUTIONS.—Sub-
paragraph (A) shall not apply to a contribution
described in subsection (b)(1)(C)(iv). If the
amount of the contribution described in sub-
section (b)(1)(C)(iv), payment of which is made
within the taxable year, exceeds the taxpayer’s
contribution base for the taxable year, such ex-
cess shall be treated as a contribution so de-
scribed paid in each succeeding taxable year, in
order of time.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to contributions made in taxable
years beginning after the date of the enactment of this
Act.
SEC. 4. INCREASE IN CHARITABLE CONTRIBUTION LIMIT
FOR FARMERS AND RANCHERS DOING BUSI-
NESS IN CORPORATE FORM.
(a) IN GENERAL.—Section 170(b)(1) of the Internal
Revenue Code of 1986 (relating to percentage limitation
of individuals), as amended by section 2(a), is amended
by redesignating subparagraph (G) as subparagraph (H)
and by inserting after subparagraph (F) the following:
‘‘(G) CERTAIN
FARMERS
AND
RANCH-
ERS.—An eligible farmer or rancher (as defined
in subparagraph (F)) shall be treated as an in-
dividual for purposes of this section with re-
spect to any qualified conservation contribu-
tion.’’
(b) CONFORMING AMENDMENT.—Section 170(b)(2)
of the Internal Revenue Code of 1986 is amended by strik-
ing ‘‘corporation,’’ and inserting ‘‘corporation (other than
a corporation that is an eligible farmer or rancher as de-
fined in paragraph (1)(F) with respect to a qualified con-
servation contribution),’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to donations of qualified conserva-
tion contributions (as defined in section 170(h) of the In-
ternal Revenue Code of 1986) made after the date of the
enactment of this Act, in taxable years ending after such
date.
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