What is a conservation easement?
A conservation easement is a voluntary contract land owners enter into with a land trust, government agency, or another qualified organization to restrict the development of their property in perpetuity. Land owners continue to own and use their land and can even sell their property or pass it on to family members with the restrictions in place.
The landowner usually retains the following rights:
- The right to sell the property.
- The right to farm or manage timber.
- The right to hunt, fish and recreate on the land.
- The right to transfer the land to heirs or others through a will.
- The right to restrict public access or give public access.
- The right to maintain and/or build a limited number of homes on the land.
Benefits of a conservation easement
- Charitable Contribution -When you agree not to develop a piece of land, its appraised value is reduced. You can claim the reduction in value as a charitable contribution.
- Reduced Property Taxes – A conservation easement may reduce or stabilize property taxes, depending on current zoning and land use and current assessed value.
- Reduced Estate Taxes – The donation of a conservation easement, whether during the landowner’s life or by bequest, can reduce the value of the land upon which estate taxes are calculated. This benefit can often mean the difference between heirs having to sell or develop the property to pay estate taxes, or being able to keep the property in the family. A conservation easement may be an effective way to pass land on to the next generation in its natural state.
Your tax attorney and accountant can tell you more about specific tax benefits.
Photo Credit: The Truex Family’s Protected Farm, by Nancy Rhoda
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