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Warning signs in syndicated conservation easement tax deductions

On Behalf of | May 31, 2022 | IRS Audits

Owning or investing in a business in Georgia can be fraught with peril. In most cases, you or your adviser can spot the red flags in time to avoid them. But in some areas, even experienced investors can find themselves in an unpleasant situation. This is especially the case with certain kinds of easements.

The IRS has taken notice of fraud

The first thing that any investor should know about the latest series of so-called syndicated conservation easement audits is that the IRS has declared them fraudulent. As a result, anyone who chooses to partake in them could be liable to severe penalties. The best thing that you can do when it comes to these kinds of easements will be to avoid them.

If you have already made an investment in these types of easements, you should know that you may be audited by the IRS at some point. It may be in your best interest to contact your financial adviser.

There are red flags to look out for

The last thing that any business owner or investor wants to go through is an IRS audit in Georgia. Luckily, there are a number of red flags that, if properly noticed, will tip you off to the possibility of a scam.

One of them will be the fact that a particular easement is being aggressively talked up by a promoter. They may try to offer you a deal that is simply too good to be true. You may also notice that the easement appears to violate one or more Georgia tax statutes. The best course of action is often to err on the side of caution and to discuss any major financial moves with a qualified tax professional.