| Easements
Many individuals or corporations
own historically important land and wish to preserve
their property without relinquishing the title. Donation
of a conservation easement is one way to achieve both
ends.
You should always consult your tax or financial consultant
before making any tax changes or donations. This is
a very brief overview of the issues concerning easements.
If you have any questions about this process, please
contact CWPT staff. We can direct you to publications
that provide more in-depth coverage, or begin to discuss
the possibilities of your particular situation.
What is a conservation easement?
Conservation easements, which are also commonly referred
to as open space, historic preservation, or scenic
easements, are legal agreements that restrict the
type and amount of development that may take place
on a property. The owner retains title to the property
and only specific rights are voluntarily transferred
to the recipient of the easement. Easements are permanent,
remaining in force when the land changes hand.
For what purpose is an easement given?
A landowner gives an easement to forever preserve
open space and historic areas against the pressures
of development. These documents are flexible and may
be written to protect various types of land, depending
on the desire of the owner. Easements may also significantly
lower estate taxes - sometimes making the difference
between an heir's ability to keep land in the family
and the need to sell it. In addition, easements may
provide landowners with income and property tax benefits.
Who may donate an easement?
The owner of record may give an easement restricting
the use of his or her land.
Does an easement restrict land development?
Yes, but easements may be written to allow for limited,
appropriate development and uses.
If the landowner has a sizeable tract
of land, and wants to protect only a portion, must
the easement be placed on the entire property?
No. Each situation is different and the limits of
the easement will be determined by the donor.
Can a landowner give a conservation easement
for a limited term?
In many states a landowner may, but to receive federal
tax benefits, easements must be written for perpetuity.
Does an easement open the donor's land
to the public?
No. The property is still protected from trespass.
In some cases, however, the landowner may choose to
allow limited pubic access for historical interpretation.
What can a conservation easement mean
to a landowner?
A landowner who gives an easement on a parcel of land
is assured that the land will remain as he or she
has known it and that it will be protected from the
pressures of urbanization. The owner can also continue
with traditional use of the land and use it for any
new purposes not prohibited by the easement.
Does an easement donation affect state
and federal taxes?
The gift of a qualified historic preservation easement
in perpetuity may be a "charitable" deduction
for income tax purposes. The value of the gift is
measured by the decrease in fair market value of the
property, which is usually 25% to 50%. Inheritance
and estate taxes may also be affected, and in many
cases avoided, by lowering the value of the land.
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