I
107TH CONGRESS
1ST SESSION
H. R. 960
To amend the Internal Revenue Code of 1986 to expand the incentives
for transferring land or easements therein for conservation purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 8, 2001
Mr. KOLBE 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 expand
the incentives for transferring land or easements therein
for conservation 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 ‘‘Conservation Tax In-
centive Act of 2001’’.
SEC. 2. EXCLUSION OF 50 PERCENT OF GAIN ON SALES OF
LAND OR INTERESTS IN LAND OR WATER TO
ELIGIBLE 
ENTITIES 
FOR 
CONSERVATION
PURPOSES.
(a) IN GENERAL.—Part III of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 (relating to
items specifically excluded from gross income) is amended
by inserting after section 121 the following new section:
‘‘SEC. 121A. 50-PERCENT EXCLUSION OF GAIN ON SALES OF
LAND OR INTERESTS IN LAND OR WATER TO
ELIGIBLE 
ENTITIES 
FOR 
CONSERVATION
PURPOSES.
‘‘(a) EXCLUSION.—Gross income shall not include 50
percent of any gain from the sale of land or an interest
in land or water (determined without regard to any im-
provements) to an eligible entity if—
‘‘(1) such land or interest in land or water was
owned by the taxpayer or a member of the tax-
payer’s family (as defined in section 2032A(e)(2)) at
all times during the 3-year period ending on the date
of the sale, and
‘‘(2) such land or interest in land or water is
being acquired by an eligible entity which provides
the taxpayer, at the time of acquisition, a written
letter of intent which shall include the following
statement: ‘The purchaser’s intent is that this acqui-
sition will serve 1 or more of the conservation pur-
poses specified in clause (i), (ii), or (iii) of section
170(h)(4)(A).’
‘‘(b) ELIGIBLE ENTITY.—For purposes of this sec-
tion, the term ‘eligible entity’ means—
‘‘(1) any agency of the United States or of any
State or local government, or
‘‘(2) any other organization that—
‘‘(A) is organized and at all times operated
principally for 1 or more of the conservation
purposes specified in clause (i), (ii), or (iii) of
section 170(h)(4)(A), and
‘‘(B) is described in section 170(h)(3).
‘‘(c) STOCK IN HOLDING CORPORATIONS.—For pur-
poses of this section, the term ‘land or an interest in land
or water’ shall include stock in any corporation, if the fair
market value of the corporation’s land or interests in land
or water equals or exceeds 90 percent of the fair market
value of all of such corporation’s assets at all times during
the 3-year period ending on the date of the sale.’’.
(b) CLERICAL AMENDMENT.—The table of sections
for part III of subchapter B of chapter 1 of such Code
is amended by inserting after the item relating to section
121 the following new item:
‘‘Sec. 121A. 50-percent exclusion of gain on sales of land or in-
terests in land or water to eligible entities for con-
servation purposes.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to sales occurring on or after De-
cember 31, 2003.
SEC. 3. EXPANSION OF ESTATE TAX EXCLUSION FOR REAL
PROPERTY SUBJECT TO QUALIFIED CON-
SERVATION 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 (defining land sub-
ject to a qualified conservation easement) is amended to
read as follows:
‘‘(i) which is located in the United
States or any possession of the United
States,’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply to estates of decedents dying after
December 31, 2001.
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