In addition to health and food benefits, conserving land increases property values near greenbelts, saves tax dollars by encouraging more efficient development, and reduces the need for expensive water filtration facilities. Study after study has demonstrated the tremendous economic benefits of land conservation.
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There are also significant tax benefits available to donors of land or conservation easements. Below is a summary of some of these benefits along with examples of how they work.
Federal Tax Benefits
There are two main kinds of federal tax benefits available to conservation donors: federal income tax benefits and federal estate tax benefits.
Federal Income Tax Benefits
Donors of land and conservation easements may claim an income tax deduction under RS170 of the Internal Revenue Code. The exact amount of tax savings depends on several factors:
How long the donor has owned the property. Benefits are generally greater if owned for more than one year.
- How the donor has used the property i.e. residence, investment or agricultural.
- The income of the donor; the higher ones income the more one will save on taxes.
- The value of the donated property; the more valuable the property, the bigger the deduction.
Federal Estate Tax Benefits
A donor may also save substantially on estate taxes if he or she donates a conservation easement. Under § 2031(c) of the Code, up to $500,000 may be excluded from one’s taxable estate if he or she had donated a qualifying easement. As with the income tax benefits, the larger the value of the donated easement, the bigger the deduction.