### Question
How does the law define applicable percentage?


### Answer
Under *26 U.S.C. § 2031*, **applicable percentage** is defined as:

> 40 percent reduced (but not below zero) by 2 percentage points for each percentage point (or fraction thereof) by which the value of the qualified conservation easement is less than 30 percent of the value of the land (determined without regard to the value of such easement and reduced by the value of any retained development right (as defined in paragraph (5)))

#### Citation:
  - *26 U.S.C. § 2031*
  - Heading: **Subtitle B-Estate and Gift Taxes > CHAPTER 11-ESTATE TAX > Subchapter A-Estates of Citizens or Residents > PART III-GROSS ESTATE**

