New Tax Breaks for Donated Conservation Easements

August 16, 2006


Amanda Nickerson, Communications Specialist
Society for the Protection of New Hampshire Forests
(603) 224-9945, ext. 301

New Tax Breaks for Donated Conservation Easements
A new measure expanding tax deductions for landowners who donate conservation easements will take effect this week.

Washington, D.C., August 4, 2006—Tax incentive language that was written into pensions bill (HR 4) was approved by Congress on August 4 and is expected to be signed into law by President Bush on Thursday, August 17. Not only will HR 4 raise the deduction a donor can take from 30 to 50 percent of their Adjusted Gross Income in a given year, it also allows donors to carry-forward and take those deductions for up to15 successive years instead of five years.

“This legislation is strong incentive for those landowners willing to donate a conservation easement on their property,” said Paul Doscher, VP for Land Protection for the Forest Society. “We expect many New Hampshire landowners will want to take advantage of the new law.” The new rules only apply to conservation easements donated in 2006 and 2007, Doscher pointed out. He added that this new but temporary incentive may also benefit landowners who can't afford to make full donations of their conservation easements. If a landowner sells an easement at a price below its actual value, this is called a "bargain sale" and can yield a combination of cash and charitable deduction for the seller/donor.

Qualifying ranchers and farmers (someone who receives more than 50% of their income from farming),which includes “the planting, cultivating, caring for, or cutting of trees, or the preparation (other than milling) of trees for market,” may deduct up to 100% of their income in a given tax year. The bill will also include reforms that will tighten rules for easements that include historic buildings, as well as for the appraisal process.

For more information about the details of this significant new incentive for conservation, contact your legal/tax advisor, or visit the Land Trust Alliance's (link no longer works) question and answer page.

For more information about donating a conservation easement to the Forest Society, call 224-9945 and ask the receptionist to connect you to the land protection specialist for your area of New Hampshire. For information about other land trusts in New Hampshire, ask for Dijit Taylor at the Forest Society's Center for Land Conservation Assistance.

The Society for the Protection of New Hampshire Forests is the state’s oldest and largest non-profit land conservation organization. In order to preserve the quality of life New Hampshire residents know today, the goal of the Forest Society, in partnership with other conservation organizations, private landowners, and government, is to conserve an additional one million acres of the state’s most significant natural lands for trails, parks, farms and forests by 2026.