I
106TH CONGRESS
2D SESSION
H. R. 4100
To amend the Internal Revenue Code of 1986 to exclude from gross income
gain on the sale or exchange of certain farmland the use of which
is restricted in perpetuity to use as farmland.
IN THE HOUSE OF REPRESENTATIVES
MARCH 28, 2000
Mr. PITTS (for himself, Mr. BOEHLERT, Mrs. CAPPS, Mr. PETERSON of Penn-
sylvania, Mr. DEMINT, Mr. ENGLISH, Mr. GOODE, Mr. HOEFFEL, Mr.
GOODLING, Mr. WELDON of Pennsylvania, Mr. GILMAN, Mr. TANCREDO,
Mr. RYUN of Kansas, Mr. FRANKS of New Jersey, Mr. KINGSTON, and
Mr. DEAL of Georgia) 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 exclude
from gross income gain on the sale or exchange of cer-
tain farmland the use of which is restricted in perpetuity
to use as farmland.
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 ‘‘Open Space Preserva-
tion Act of 2000’’.
SEC. 2. EXCLUSION OF GAIN FROM SALE OF CERTAIN
FARMLAND.
(a) GENERAL RULE.—Part III of subchapter B of
chapter 1 of the Internal Revenue Code of 1986 (relating
to items specifically excluded from gross income) is
amended by redesignating section 139 as section 139A
and by inserting after section 138 the following new sec-
tion:
‘‘SEC. 139. SALES AND EXCHANGES OF CERTAIN FARMLAND
WHICH BY COVENANT IS RESTRICTED TO USE
AS FARMLAND.
‘‘(a) GENERAL RULE.—In the case of an operator of
qualified farmland, gross income does not include gain
from the sale or exchange of qualified farmland if there
is in effect on the date of such sale or exchange a qualified
farmland conservation easement.
‘‘(b) DEFINITIONS.—For purposes of this section—
‘‘(1) QUALIFIED FARMLAND.—The term ‘quali-
fied farmland’ means any real property—
‘‘(A) which is located in the United States,
‘‘(B) which is used as a farm for farming
purposes (within the meaning of section
2032A(e)), and
‘‘(C) which is located in a county which
has a population of 100 or more persons per
square mile.
‘‘(2) QUALIFIED
FARMLAND
CONSERVATION
EASEMENT.—The term ‘qualified farmland conserva-
tion easement’ means a restriction (granted in per-
petuity) which does not permit any use of the land
for any purpose other than use as a farm for farm-
ing purposes (within the meaning of section
2032A(e)).
‘‘(c) VERIFICATION OF EASEMENT.—Subsection (a)
shall not apply by reason of any qualified farmland con-
servation easement unless the taxpayer—
‘‘(1) notifies (in such form and manner as the
Secretary may by regulations prescribe) both the
Secretary and the Secretary of Agriculture of the
political subdivision of the State in which such ease-
ment is recorded, and
‘‘(2) submits to the Secretary a copy of such
easement.’’
(b) CLERICAL AMENDMENT.—The table of sections
for such part is amended by striking the last item and
inserting the following new items:
‘‘Sec. 139. Sales and exchanges of certain farmland which by cov-
enant is restricted to use as farmland.
‘‘Sec. 139A. Cross references to other Acts.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to restrictions first recorded after
December 31, 2000, and to sales and exchanges after such
date.
Æ