The donation of a conservation easement that meets federal tax code requirements may make you eligible for a federal income tax deduction. A qualified appraiser will calculate the value of the easement by determining the value of the donor's land before the easement is given, then subtracting the value of the land after the easement is donated.

The value of the conservation easement donation can be deducted at a rate of 50% of the donor's adjusted gross income per year and the unused portion of the gift may be carried forward for an additional fifteen years or until the value of the donation is fully expanded, whichever comes first. This expansion of the rate of deduction is particularly helpful to those landowners who do not have a large taxable income. Farmers who receive more than 50% of their income from agricultural activities can deduct the donation at the rate of 100% of their adjusted gross income.

PEC provided the summary of the tax benefits of conservation easements for informational purposes only. Please consult your attorney and/or accountant for professional advice on the implications of an easement donation for your own tax situation.