On Dec. 29, 2022, the United States Congress passed the SECURE 2.0 Act of 2022 (SECURE Act 2.0). Section 605(d) of the SECURE Act 2.0 gave conservation easement donors a safe harbor to amend provisions relating to extinguishment and boundary line adjustment. Historically, these suspect clauses have been heavily included in syndicated easements that have been used as fraudulent tax shelters.
These problematic provisions arguably have two major effects: (1) overly donor-favorable extinguishment provisions could deprive land trusts from receiving adequate compensation in the event a subsequent unexpected change renders the continued use of the property for conservation purposes to be impossible or impractical, and (2) boundary line adjustment provisions could undermine the requirement that the restrictions on the use of real property subject to conservation easements must be perpetual.
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