diff --git a/packages/taco/test/conditions/if-then-else-condition.test.ts b/packages/taco/test/conditions/if-then-else-condition.test.ts
new file mode 100644
index 00000000..50897ec9
--- /dev/null
+++ b/packages/taco/test/conditions/if-then-else-condition.test.ts
@@ -0,0 +1,176 @@
+import { describe, expect, it } from 'vitest';
+
+import {
+  IfThenElseCondition,
+  ifThenElseConditionSchema,
+  IfThenElseConditionType,
+} from '../../src/conditions/if-then-else-condition';
+import { TimeConditionType } from '../../src/conditions/schemas/time';
+import {
+  testCompoundConditionObj,
+  testContractConditionObj,
+  testRpcConditionObj,
+  testSequentialConditionObj,
+  testTimeConditionObj,
+} from '../test-utils';
+
+describe('validation', () => {
+  it('infers default condition type from constructor', () => {
+    const condition = new IfThenElseCondition({
+      ifCondition: testRpcConditionObj,
+      thenCondition: testTimeConditionObj,
+      elseCondition: testContractConditionObj,
+    });
+    expect(condition.value.conditionType).toEqual(IfThenElseConditionType);
+  });
+
+  it('validates type', () => {
+    const result = IfThenElseCondition.validate(ifThenElseConditionSchema, {
+      conditionType: TimeConditionType,
+      ifCondition: testRpcConditionObj,
+      thenCondition: testTimeConditionObj,
+      elseCondition: testContractConditionObj,
+    });
+    expect(result.error).toBeDefined();
+    expect(result.data).toBeUndefined();
+    expect(result.error?.format()).toMatchObject({
+      conditionType: {
+        _errors: [
+          `Invalid literal value, expected "${IfThenElseConditionType}"`,
+        ],
+      },
+    });
+  });
+
+  it('accepts recursive if-then-else conditions', () => {
+    const nestedIfThenElseConditionObj = {
+      conditionType: IfThenElseConditionType,
+      ifCondition: testRpcConditionObj,
+      thenCondition: testTimeConditionObj,
+      elseCondition: testContractConditionObj,
+    };
+
+    const conditionObj = {
+      conditionType: IfThenElseConditionType,
+      ifCondition: testTimeConditionObj,
+      thenCondition: nestedIfThenElseConditionObj,
+      elseCondition: nestedIfThenElseConditionObj,
+    };
+
+    const result = IfThenElseCondition.validate(
+      ifThenElseConditionSchema,
+      conditionObj,
+    );
+    expect(result.error).toBeUndefined();
+    expect(result.data).toEqual({
+      conditionType: IfThenElseConditionType,
+      ifCondition: testTimeConditionObj,
+      thenCondition: nestedIfThenElseConditionObj,
+      elseCondition: nestedIfThenElseConditionObj,
+    });
+  });
+
+  it('accepts nested sequential and compound conditions', () => {
+    const conditionObj = {
+      conditionType: IfThenElseConditionType,
+      ifCondition: testRpcConditionObj,
+      thenCondition: testSequentialConditionObj,
+      elseCondition: testCompoundConditionObj,
+    };
+    const result = IfThenElseCondition.validate(
+      ifThenElseConditionSchema,
+      conditionObj,
+    );
+    expect(result.error).toBeUndefined();
+    expect(result.data).toEqual({
+      conditionType: IfThenElseConditionType,
+      ifCondition: testRpcConditionObj,
+      thenCondition: testSequentialConditionObj,
+      elseCondition: testCompoundConditionObj,
+    });
+  });
+
+  it.each([true, false])(
+    'accepts boolean for else condition',
+    (booleanValue) => {
+      const conditionObj = {
+        conditionType: IfThenElseConditionType,
+        ifCondition: testTimeConditionObj,
+        thenCondition: testRpcConditionObj,
+        elseCondition: booleanValue,
+      };
+
+      const result = IfThenElseCondition.validate(
+        ifThenElseConditionSchema,
+        conditionObj,
+      );
+      expect(result.error).toBeUndefined();
+      expect(result.data).toEqual({
+        conditionType: IfThenElseConditionType,
+        ifCondition: testTimeConditionObj,
+        thenCondition: testRpcConditionObj,
+        elseCondition: booleanValue,
+      });
+    },
+  );
+
+  it('limits max depth of nested if condition', () => {
+    const result = IfThenElseCondition.validate(ifThenElseConditionSchema, {
+      ifCondition: {
+        conditionType: IfThenElseConditionType,
+        ifCondition: testRpcConditionObj,
+        thenCondition: testCompoundConditionObj,
+        elseCondition: testTimeConditionObj,
+      },
+      thenCondition: testRpcConditionObj,
+      elseCondition: testTimeConditionObj,
+    });
+    expect(result.error).toBeDefined();
+    expect(result.data).toBeUndefined();
+    expect(result.error?.format()).toMatchObject({
+      ifCondition: {
+        _errors: [`Exceeded max nested depth of 2 for multi-condition type`],
+      },
+    });
+  });
+
+  it('limits max depth of nested then condition', () => {
+    const result = IfThenElseCondition.validate(ifThenElseConditionSchema, {
+      ifCondition: testRpcConditionObj,
+      thenCondition: {
+        conditionType: IfThenElseConditionType,
+        ifCondition: testRpcConditionObj,
+        thenCondition: testCompoundConditionObj,
+        elseCondition: true,
+      },
+      elseCondition: testTimeConditionObj,
+    });
+    expect(result.error).toBeDefined();
+    expect(result.data).toBeUndefined();
+    expect(result.error?.format()).toMatchObject({
+      thenCondition: {
+        _errors: [`Exceeded max nested depth of 2 for multi-condition type`],
+      },
+    });
+  });
+
+  it('limits max depth of nested else condition', () => {
+    const result = IfThenElseCondition.validate(ifThenElseConditionSchema, {
+      ifCondition: testRpcConditionObj,
+      thenCondition: testTimeConditionObj,
+      elseCondition: {
+        conditionType: IfThenElseConditionType,
+        ifCondition: testRpcConditionObj,
+        thenCondition: testSequentialConditionObj,
+        elseCondition: testTimeConditionObj,
+      },
+    });
+    expect(result.error).toBeDefined();
+    expect(result.data).toBeUndefined();
+    expect(result.error?.format()).toMatchObject({
+      elseCondition: {
+        _errors: [`Exceeded max nested depth of 2 for multi-condition type`],
+      },
+    });
+  });
+});