For
those of you new to land conservation, we have articles to introduce you to the
basic concepts. These articles will help you understand the federal and state tax
and estate planning issues and incentives associated with charitable donations of
land and conservation easements. Our library of technical articles and papers addresses
current issues and topics for the conservation professional as well. Once you are
ready, connect with the local professional advisors to explore options for the future
of your land.
Before you can decide what is right for you and your land, review some basic definitions associated with the conservation tools commonly used in estate planning for real estate assets.
Read More »By: Colleen Schreiber
Some choose to use conservation easements; others choose not to, but either way, a wise choice requires education on what can be a complicated subject. To aid in that education process,
Texas Agricultural Land Trust recently sponsored a seminar in which they brought in a renowned authority on the laws pertaining to conservation easements, with an emphasis on using this tool for estate planning. Massachusetts-based
Stephen J. Small was an attorney for the IRS prior to starting his private practice. During his stint with the IRS, Small was responsible for writing the federal income tax regulations on conservation easements.
Read More »By:
Adam Miller
It may come as a shock, but there is a sort of symbiotic relationship at work between property owners with conservation easements and the IRS. Hard to believe, I know. We understand that the IRS gives tax breaks for those who protect their property from certain development and use. In special circumstances, these landowners can find tax breaks that many others will not reach, similar to the nectar only available to the unique and capable hummingbirds.
The Landowner, Conservation Easements & the 2010 Roth Conversion. At the beginning of 2010, the $100,000 MAGI (Modified Adjusted Gross Income) limit on Roth IRA conversions was lifted. Individuals that were not able to convert an IRA to a Roth in previous years may now be eligible, and the subject is getting quite a bit of news.
Read More »By:
Robert LevinHow does one go about donating or selling a conservation easement.? There is no one right way to go about it. However, the following outline shows the most common steps to the process. Conveying an easement may take anywhere from a few months to a couple years, depending on a variety of factors. The landowner usually must pay for basic legal expenses, and appraisal, and in many cases is asked to make a stewardship donation to ensure that the land remains protected forever. Although the following outline discusses easements, a similar process typically applies to donations of whole interests in land as well.
Read More »By:
Robert LevinThe following is an adapted version of an article that appeared in Tax Notes Today in October 30, 2000. Robert H. Levin is a practicing Maine attorney who specializes in land conservation. He works with land trusts and landowners on all aspects of conservation matters. In this article, he examines the opportunities available under Section 2031(c) of the Internal Revenue Code, in particular the post-mortem donation of a conservation easement. The article demonstrates that fiduciary obligation law in most states does not prevent a personal representative from donating a conservation easement from a decedent’s estate. The author would like to acknowledge
Read More »The IRS is involved and interested in land conservation. The agency provides incentives, namely tax deductions, and enforces compliance with the tax code for tax deductions identified as conservation contributions. A conservation contribution is defined by the Internal Revenue Code § 170(h).
Read More »By: Jeremiah P. Cosgrove and Judy Anderson
Based on the belief that a working, commercially-viable, agricultural landscape is the desired long-term land use, and that the soil resource is the foundation for agricultural protection, conservation organizations are realizing that agricultural easements, compared to scenic open space or historic easements, are very different.
In general, agricultural easements recognize the farmer’s need to be able to respond to a changing agriculture and are written with the knowledge that farmers, perhaps more than any other group of landowners, must make countless decisions on a daily basis about how they work the land, and respond to new market conditions. Timing and flexibility can be critical when deciding if they need to construct a new fence, plant a particular crop, apply nutrients and chemicals, construct or renovate a building, or subdivide or acquire a parcel of land.
Read More »This regulation elaborates on IRC section 170; further expalining what a qualified conservation contribution is.
Click here. Read More »This case provides an overview of charitable purpose requirements for tax exemption of forest land in Massachusetts. The case is an appeal from the refusal of the Town of Hawley (“assessors” or “appellee”), to abate a tax on certain real estate located in the Town of Hawley owned by and assessed to New England Forestry Foundation, Inc. (“NEFF” or “appellant”) for fiscal year 2010.
Read More »By: Jeremiah P. Cosgrove and Renee J. Bouplon
Based on the belief that a working, commercially-viable, agricultural landscape is the desired long-term land use, and that the soil resource is the foundation for agricultural protection, conservation organizations are realizing that agricultural easements, compared to scenic open space or historic easements, are very different.
Read More »By: Breana Behrens
Baseline documentation is a record of what the land subject to a conservation easement looks like at the time of the donation. Maps, descriptions, and pictures of the preserved property and resources are important for outlining the conservation goals of the donor, as well as enforcing the conservation easement and settling future disputes about the use of the land. Baseline documentation is required by the IRS if a donor reserves a right to the land that may impair a protected conservation interest.
Read More »By:
Stephen J. Small, Esq.In this comprehensive article, Boston attorney Stephen J. Small notes that a small number of "bad" conservation easement deals threaten to poison the well for otherwise successful, appropriate, and important private land conservation transactions if IRS enforcement is not targeted at the promoters, appraisers, and others engaged in the bad deals. Small also discusses the main tax and planning hurdles that make it difficult for a real estate developer to get a meaningful income tax deduction for the donation of a conservation easement, including the tricky question of whether a conservation easement is characterized as a capital asset or inventory. Finally, Small makes suggestions for better enforcement in this area, including presenting a list of questions the IRS might ask on a revised Form 8283, "Noncash Charitable Contributions," or other reporting form.
Read More »A simple example illustrates how a conservation easement works in practice. Let’s assume pressure from buyers building vacation homes has pushed the value of land up in recent years to the point where the family is concerned about how the next generation will pay the estate tax bill without selling the land.
Read More »By: Breana Behrens
Treasury Regulations 1.170A-14 explains that a conservation easement must be for a conservation purpose in order for a donor to recieve a charitable tax deduction. There are four conservation purposes that the IRS will consider valid preservation for; outdoor recreation or education, natural habitat, open space or certified historic structures.
Read More »In a letter, the IRS clarified that state law may provide a means for exterminating a conservation easement. However, the requirement of section 170(h) that a conservation purpose must be protected in perpetuity and can only be exterminated or amended by a judicial proceeding must be met.
Read More »By:
Jessica Jay and Melissa K. Thompson
This article surveys conservation easement enforcement and defense decisions to date, and examines those decisions under the rubric of several general themes. The article focuses on themes influencing or driving the opinions of
courts in conservation easement enforcement and defense actions across jurisdictional lines. These themes include issues of standing, ambiguity and the role of intent in judicial decision-making on issues of conservation easement enforcement and defense, judicial attitudes towards restrictive servitudes, the role of common law rules of real property and contract construction and interpretation, and cost-benefit analyses.
Read More »By:
Elizabeth WroblickaConservation easements (“CE”) present a unique challenge to those who seek to uphold them in court. Given the nature of perpetuity, it is inevitable that the inPiduals involved in preparing and negotiating a CE will be deceased when it comes time to enforce its provisions at a trial many years from now. The CE deed may not contain terms that adequately define or describe the original intent of the parties or the condition of the land. The land trust and public agency (collectively “holder”) seeking to defend or enforce a CE in court will need to introduce evidence in the form of supporting documents such as photographs, maps, monitoring reports and correspondence to establish the critical elements of its case.
Read More »By:
Nancy McLaughlinOn January 30, 2013, the United States filed a complaint against a land appraiser and his company. According to the complaint, he had appraised more than 90 conservation easements for purposes of the deduction under IRC § 170(h) and earned substantial fees for his appraisals, ranging up to $40,000 for a single appraisal.
Read More »By: Resources First Foundation - RFF
Conservation easements can be a valuable tool to ensure that you can keep your working landscape viable. It is a restriction on the use of your property that is voluntary and modifiable to fit your needs.
Read More »This case addressed whether the landowners may construct a dwelling for their use anywhere on the land they own that is subject to an agricultural preservation restriction (conservation easement). The court held that the terms of the restriction granted the landowners the right to build, but the location is subject to the approval of the commissioner.
Read More »By: Breana Behrens
A private landowner that would like to sell or retain rights to subsurface gas, oil, or minerals may still be able to place a conservation easement on their surface estate.
Read More »