Land Conservation Tools

Below is a interactive flowchart to demonstrate the options you have as a landowner to protect, preserve, lease or donate your land. If you are interested in further information about these conservation tools please download the documents and contact us for detailed information.
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Advantages

  • Easements provide income tax, estate tax and gift tax benefits if the easement is donated or sold at less than market value.
  • The property owner retains ownership of the property while potentially receiving income tax, estate tax and property tax reductions.

Disadvantages

  • Easements can involve giving up some property usage rights.
  • The landowner maintains the land and is responsible for expenses, including taxes.

Advantages

  • The landowner can receive payments for the leased property.
  • The landowner can protect the land for a specified period without transferring the land to another entity.
  • The landowner can terminate the lease if the property is not being used as directed.

Disadvantages

  • Leases expire.
  • Unless provisions are made by the landowner, leases generally allow unrestricted and exclusive control of the land by the organization or agency leasing the property.

Advantages

  • The landowner may be able to receive direct payments or other types of financial assistance.
  • The landowner can often use the services of the land trust, conservation organization or agency to develop a site management and maintenance plan.
  • It is easier to terminate a lease with a management agreement than with some other arrangements.
  • Payments or cost-share maybe available for management or maintenance activities.

Disadvantages

  • Management agreements expire.

Advantages

  • Technical and financial assistance is available for many if not all project expenses.
  • Restored wetlands can create views and attract wildlife that boost property values and quality of life.

Disadvantages

  • Restoration without outside financial assistance can be expensive.
  • Restoration is not always entirely successful.
  • Restoration and rehabilitation of a site is generally a long-term commitment.

Advantages

  • A landowner can raise the money necessary to protect the more environmentally sensitive property.
  • A landowner can combine conservation and limited development to help meet financial needs.
  • A landowner can realize tax advantages by recording an easement over the undeveloped part of the land.

Disadvantages

  • It can be difficult to determine which areas of the property are the least sensitive.
  • Limiting land development can reduce its profitability.
  • Adjacent land use may affect the wetland area.

Advantages

  • Landowners enjoy all rights to the property during their lifetime, except those that degrade the natural resource value.
  • Landowners provide future protection of the property.
  • Donation for conservation purposes qualifies the landowner for a tax deduction, discounted in proportion to the anticipated length of time before the grantee takes over the interest.
  • Whether the land is sold or donated, dedication of the remainder interest reduces the burden of the estate taxes.

Disadvantages

  • The designation may restrict some uses of the land during the landowner’s lifetime that may degrade the natural resource value.

Sale Option
Landowners can choose from these four sale options:

  1. Fair market value: The landowner sells the property for its fair market value.
  2. Bargain sale: The landowner sells the property to a land trust, conservation organization or agency at a price below the fair market value. The difference between the sale price and fair market value can be characterized as a donation.
  3. nstallment sale: The landowner sells the property to a land trust or conservation organization where all or part of the consideration is deferred and paid in successive years.
  4. Right of first refusal: The landowner gives a land trust or conservation organization the option to match a purchase offer and acquire the land if another buyer approaches the landowner.

Advantages

  • Sale at full market value allows the landowner to receive full value for property.
  • Bargain sales offer a tax deduction and reduction of capital gains taxes to the landowner.
  • Installment sales can defer the actual capital gains tax until the purchase with which to pay the tax is in hand.
  • Right of first refusal can give land trusts and other conservation organizations time to acquire the funds necessary for purchasing the land.

Disadvantages

  • Most land trusts and conservation organizations have limited budgets and can rarely pay full market value for wetlands.
  • If the land value has appreciated since it was purchased, the landowner becomes liable for the income tax on the capital gain

Donation of Land Landowners can choose from three types of donations:

  1. Outright donation grants full title and ownership to the conservation organization, community or government agency receiving the donated property.
  2. Donation by deathtime transfers property through a will.
  3. Donation with a reserved life estate permits the landowner to use the donated property during his or her lifetime and the lifetimes of designated family members.

Advantages

  • Donation provides total protection for a wetland.
  • Landowners can receive income tax deductions and possible estate, gift and property tax breaks.
  • Land trusts and conservation organizations, which may not have the budget to buy wetlands, can fulfill their mission to protect wetlands.
  • Outright donation requires little negotiation and can be completed quickly.
  • Donation at deathtime allows the landowner and their family to retain interim control and full use of their property, while ensuring protection after the landowners’ death.
  • Donation with reserved life estate allows the landowners and their family to continue to live on the land, while ensuring it future protection.

Disadvantages

  • The landowner forfeits potential income from the sale of the land.
  • Maintenance and other associated costs taken on by the land trust or organization may be more costly than a conservation easement.
  • There is no income tax deduction for a donation by deathtime transfer.
  • The landowner is responsible for property taxes as long as they remain in possession of the land.
  • Many land trusts may not be able to accept the donation without additional funding for an endowment to support long-term management of the property. Tax relief from donation with a reserved life estate generally applies to farms and personal residences, and in some cases wetlands may not qualify.