SEC. 3. GIFT TAX ON LAND SUBJECT TO A QUALIFIED CON-
SERVATION EASEMENT.
(a) GIFT TAX WITH RESPECT TO LAND SUBJECT TO
A QUALIFIED CONSERVATION EASEMENT.—Section 2503
of the Internal Revenue Code of 1986 (relating to taxable
gifts) is amended by adding at the end the following new
subsection:
‘‘(h) GIFT TAX WITH RESPECT TO LAND SUBJECT
TO A QUALIFIED CONSERVATION EASEMENT.—The trans-
fer by gift of land subject to a qualified conservation ease-
ment shall not be treated as a transfer of property by gift
for purposes of this chapter. For purposes of this sub-
section, the term ‘land subject to a qualified conservation
easement’ has the meaning given to such term by section
2031(c); except that references to the decedent shall be
treated as references to the donor and references to the
date of the decedent’s death shall be treated as references
to the date of the transfer by the donor.’’
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply to gifts made after December 31,
1996.
SEC. 4. TREATMENT UNDER ALTERNATE VALUATION OF
FARM PROPERTY RULES OF QUALIFIED CON-
SERVATION CONTRIBUTIONS AND LAND SUB-
JECT TO QUALIFIED CONSERVATION EASE-
MENTS.
(a) EXCEPTIONS FROM RECAPTURE RULES
FOR
LAND SUBJECT TO QUALIFIED CONSERVATION EASE-
MENT
AND
QUALIFIED
CONSERVATION
CONTRIBU-
TIONS.—Subsection (c) of section 2032A of the Internal
Revenue Code of 1986 (relating to alternative valuation
method) is amended by adding at the end the following
new paragraphs:
‘‘(8) EXCEPTION
FOR
LAND
SUBJECT
TO
A
QUALIFIED CONSERVATION EASEMENT.—If qualified
real property is land subject to a qualified conserva-
tion easement (as defined in section 2031(c)), the
preceding paragraphs of this subsection shall not
apply.
‘‘(9) QUALIFIED CONSERVATION CONTRIBUTION
IS
NOT
A
DISPOSITION.—A qualified conservation
contribution (as defined in section 170(h)) by gift or
otherwise shall not be deemed a disposition under
subsection (c)(1)(A).’’
(b) LAND SUBJECT TO A QUALIFIED CONSERVATION
EASEMENT IS NOT DISQUALIFIED.—Paragraph (1) of
section 2032A(b) of such Code (relating to alternative
valuation method) is amended by adding at the end the
following new subparagraph:
‘‘(E) If property is otherwise qualified real
property, the fact that it is land subject to a
qualified conservation easement (as defined in
section 2031(c)) shall not disqualify it under
this section.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to contributions made, and ease-
ments granted, after December 31, 1986.
SEC. 5. QUALIFIED CONSERVATION CONTRIBUTION WHERE
SURFACE AND MINERAL RIGHTS ARE SEPA-
RATED.
(a) IN GENERAL.—Section 170(h)(5)(B)(ii) of the
Internal Revenue Code of 1986 (relating to special rule)
is amended to read as follows:
‘‘(ii) SPECIAL RULE.—With respect to any con-
tribution of property in which the ownership of the
surface estate and mineral interests has been and re-
mains separated, subparagraph (A) shall be treated
as met if the probability of surface mining occurring
on such property is so remote as to be negligible.’’
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply with respect to contributions made
after December 31, 1992, in taxable years ending after
such date.
Æ