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subdivision property. Neither of the experts in this case
assumed petitioner's property is subdivision property.
A conservation easement frequently is granted by deed of
gift; consequently, there is rarely an established market from
which to derive fair market value. See Symington v.
Commissioner, 87 T.C. 892, 895 (1986). If no comparable sales of
easements are available to determine the value, the easement is
generally valued by a "before and after" analysis, comparing the
fair market value of the property before the granting of the
easement with the fair market value of the property after the
granting of the easement. Browning v. Commissioner, 109 T.C.
303, 315 (1997); Stanley Works v. Commissioner, supra at 399;
Hilborn v. Commissioner, supra at 688; sec. 1.170A-14(h)(3)(i),
Income Tax Regs. The reduction in the property's value by reason
of the encumbrance is the fair market value of the easement.
There is no mechanical application of the before and after
methodology when other reliable indicators of market value are
available. In explaining the legislation that permitted the
deduction for qualified conservation contributions, the Senate
Finance Committee remarked about easement appraisal methodology
as follows:
conservation easements are typically (but not
necessarily) valued indirectly as the difference
between the fair market value of the property involved
before and after the grant of the easement. (See Rev.
Rul. 73-339, 1973-2 C.B. 68 and Rev. Rul. 76-376, 1976-
2 C.B. 53.) Where this test is used, however, the
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