Jackson Crossroads, LLC, Greencone Investments, LLC, Tax Matters Partner, T.C. Memo. 2024-111, filed 12/19/24, has some GA boondocks they claim is a great source of Lower Paleozoic metamorphic granitic gneiss, the stuff they make aggregate from, which is used in construction. They claim the property is worth $23 million (and there’s a picture at p. 6) showing what might be). Conjoined with them is Long Branch Investments, LLC, Greencone Investments, LLC, Tax Matters Partner, who are out on a limb over a bulk industrial distribution park on some nearby boondocks (picture on p. 8); they claim $14.6 million.
Of course, after the syndicated conservation easements put together by a couple good ol’ boys (hi, Judge Holmes) who met at an Atlanta Braves game reduce these goldmines to “planted loblolly pine and natural hardwood forest areas as well as fields planted with soybean, chufa, corn, and wheat. The property also had two intermittent streams and two small, man-made ponds. In addition, a pole shed and dilapidated hunting camps stood on the property,” T. C. Memo. 2024-111, at p. 9, the whole shebang ain’t wuth nuthin’.
They say.
Judge Christian N. (“Speedy”) Weiler ain’t so sure, although he blows off IRS’ usual attacks on the appraisals. Most of the objections get brushed off with “they comply with the Regs, so your objections go to weight, not admissibility”. Of interest is IRS’ invocation of Reg. Section 1.170A-13(c)(5), the so-called knowledge regulation. The test is whether a reasonable person would see that the appraisal was way out of line with reality. But Judge Speedy Weiler says this has to be equal to the cataclysmic own-goal testimony from the appraiser in Oconee Landing Property, LLC, Oconee Landing Investors, LLC, Tax Matters Partner, T.C. Memo. 2024-25; see my blogpost “Four-To-One,” 2/22/24*. In short, were the LLC managers in cahoots with the appraiser?
Not here, says Judge Speedy Weiler; just the “a relatively normal back-and-forth between client and appraiser,” T. C. Memo. 2024-111, at p. 26. Judge, did you ever hear the hypertechnical phrase “mach gresser, mach veyniger“?
The appraisers are in, but the appraisals are out. There are what the USPAP call extraordinary assumptions, and irrational exuberance. CSX isn’t rebuilding their railway to suit. Judge Speedy Weiler carefully slices, dices, dissects, and shaves the worth of the two easements to about $1.1 million for the Jacksons, and $1.5 million for the Long Branchers.
Plus 40% overvaluation chops.
Taishoff Law 