There are several options available to landowners interested in conserving their land for the future.
Conservation & Agricultural Agreements on Private Land
A conservation agreement, otherwise known as a conservation or agricultural easement, is one of the options available to landowners who want to protect their land and its resources for the future. These are voluntary, legal agreements between a landowner and a land trust such as Foothills Conservancy. Under the agreement, the landowner conveys certain rights to the conservancy, most typically those to intensively subdivide or develop the land for uses other than agriculture, while retaining ownership of the property and a range of reserved rights tailored to meet the landowner’s conservation and agricultural goals.
There are many benefits to placing a conservation agreement on your land. Donating a permanent conservation agreement may reduce the amount of federal and state income taxes owed by a landowner since the value of the donated agreement qualifies as a charitable contribution supported by both federal and North Carolina state conservation tax programs. In many cases, estate taxes are also reduced.
For detailed information call 828-437-9930 or Click Here.
Does Your Land Qualify?
In North Carolina, if you donate a conservation agreement, sell land at a bargain price or donate property that provides a significant public benefit, you may qualify for a state income tax credit along with other state and federal tax benefits.
Providing a public benefit is not the same as providing public access; your land can remain in your hands and closed to the public but qualify if it serves one of the following purposes:
- Promotes fish and wildlife conservation
- Protects water quality
- Protects historic property
- Provides a scenic view
- Serves other public benefits as outlined by the state
How is the value of a Conservation Agreement Determined?
A qualified appraiser determines the land’s value both without a conservation agreement in place and with the agreement in place. The difference between these two numbers forms the basis for the N.C. tax credit, federal conservation tax deduction and other benefits.
Other Options for Qualified Conservation Land
Outright land donations – Land which meets the conservation tax programs’ criteria can result in a substantial federal income tax deduction and N.C. conservation tax credit if donated as a gift to a land trust.
Bargain sale of land – For a landowner selling property with significant conservation value to a land trust or other qualifying public entity, the difference between fair market price and a bargain sale price is treated as a charitable donation at the federal level, qualifies for North Carolina’s state conservation tax programs and can also reduce capital gains taxes payable by a landowner on the sale.
Mutual covenants – A mutual covenant is an agreement by a group of landowners that restricts land use that is not permanent.
Remainder Interest Trust – Landowners may continue to live on or use land for their lifetime when they donate land to a land trust through a remainder interest trust.
Bequests and living trusts – Bequests and living trusts allow a landowner to own and manage the property during their lifetime, while assuring permanent protection for the future. A living trust achieves the same goal, but avoids the probate process and may reduce the donor’s taxable estate.