On February 5, 2020, the Tax Court issued a Memorandum Opinion in the case of Railroad Holdings LLC v. Commissioner (T.C. Memo. 2020-22). The issue presented in Railroad Holdings LLC v. Commissioner was whether the extinguishment provisions contained in the grant of a conservation easement violated IRC § 170(h)(5)(A). Background to Railroad Holdings LLC v. Commissioner The petitioner executed a conservation easement deed in favor of a charitable organization. The deed provided that, if the easement were ever extinguished and proceeds were to be allocated between the petitioner and the charitable organization, then the organization would be entitled to a portion of the proceeds at least equal to the fair market value of the conservation easement as of the date of the grant of the conservation easement, rather than being entitled to a proportionate share of the proceeds. The petitioner claimed a charitable contribution deduction for the contribution, and the IRS…