‘‘(1) IMPOSITION OF ADDITIONAL GIFT TAX.— 
If, at any time after the gift described in subsection 
(a) and before the death of the donee— 
‘‘(A) the donee disposes of any interest 
(other than by a qualified conservation con-
tribution (as defined in section 170(h))) in 
qualified farm or conservation land and the per-
son acquiring such interest is not subject to the 
covenant described in subsection (b)(1)(C), or 
‘‘(B) the donee uses such land in any man-
ner which violates the terms of such covenant, 
then, there is hereby imposed an additional gift tax. 
‘‘(2) AMOUNT OF ADDITIONAL TAX.— 
‘‘(A) IN
GENERAL.—The amount of the 
additional tax imposed by paragraph (1) with 
respect to any interest shall be the amount 
equal to the sum of— 
‘‘(i) the adjusted tax difference with 
respect to the gift, and 
‘‘(ii) interest at the underpayment 
rate established under section 6621 on the 
amount determined under clause (i) for the 
period beginning on the date of such gift. 
‘‘(B) ADJUSTED
TAX
DIFFERENCE
WITH 
RESPECT TO GIFT.—For purposes of this sub-
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section, the term ‘adjusted tax difference with 
respect to the gift’ means the excess of— 
‘‘(i) what would have been the gift tax 
liability if the fair market value of the in-
terest at the time of the disposition or use 
described in paragraph (1), over 
‘‘(ii) the gift tax liability. 
For purposes of this subparagraph, the term 
‘gift tax liability’ means the tax imposed by sec-
tion 2501 reduced by the credits allowable 
against such tax. 
‘‘(3) CERTAIN ADDITIONAL RULES TO APPLY.— 
Rules similar to the rules of paragraphs (2)(D), 
(2)(E), (3), (4), (5), and (8) of section 2032A(c) 
shall apply for purposes of this subsection. 
‘‘(4) INCOME
TAX
TREATMENT
OF
DISPOSI-
TIONS.—For purposes of chapter 1, in any case in 
which an additional tax is imposed by this sub-
section by reason of any disposition or use of an in-
terest, such interest (if not otherwise disposed of in 
a transaction in which gain is recognized) shall be 
treated as sold at its fair market value at the time 
of the disposition or use, and gain shall be recog-
nized notwithstanding any provision of subtitle A. 
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‘‘(e) CERTAIN ADDITIONAL RULES TO APPLY.—For 
purposes of this section, rules similar to the following rules 
shall apply: 
‘‘(1) CERTAIN
REAL
PROPERTY
INCLUDED.— 
Section 2032A(e)(3)(A). 
‘‘(2) DEFINITIONS
OF
FARM
AND
FARMING 
PURPOSES.—Paragraphs (4) and (5) of section 
2032A(e). 
‘‘(3) BOND IN LIEU OF PERSONAL LIABILITY.— 
Section 2032A(e)(11). 
‘‘(4) SPECIAL RULE FOR WOODLANDS.—Section 
2032A(e)(12). 
‘‘(5) 
STATUTE
OF
LIMITATION.—Section 
2032A(f). 
‘‘(6) SPECIAL RULES FOR INVOLUNTARY CON-
VERSIONS OF REAL PROPERTY.—Section 2032A(h). 
‘‘(7) EXCHANGES OF QUALIFIED REAL PROP-
ERTY.—Section 2032A(i). 
‘‘(f) CROSS REFERENCE.—See section 6324C for 
special lien on farm and conservation land.’’. 
(2) CONFORMING AMENDMENT.—Section 2525 
of such Code, as amended by paragraph (1), is 
amended by striking ‘‘sections 2522 and 2523’’ and 
inserting ‘‘sections 2522, 2523, and 2524’’. 
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(3) CLERICAL AMENDMENT.—The table of sec-
tions for such subchapter is amended by striking the 
last item and inserting the following new items: 
‘‘Sec. 2524. Gift of farm and conservation land. 
‘‘Sec. 2525. Extent of deductions.’’. 
(d) GENERATION SKIPPING TAX.— 
(1) EXCLUSION.—Subsection (b) of section 
2611 of such Code (relating to certain transfers ex-
cluded) is amended by redesignating paragraph (2) 
as paragraph (3) and by inserting after paragraph 
(1) the following new paragraph: 
‘‘(2) any transfer which, if made inter vivos by 
an individual, would be treated as a deduction under 
section 2524 (relating to gift of farm and conserva-
tion land), or’’. 
(2) APPLICABLE RULES.—Subsection (b) of sec-
tion 2611 of such Code is amended by adding at the 
end the following flush sentence: 
‘‘For purposes of paragraph (2), rules similar to the rules 
of section 2524 shall apply.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to estates of decedents dying, gifts 
made, and generation-skipping transfers after December 
31, 2008. 
Æ 
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