By Gary Allen Burns
Conservation easements are legal instruments between a landowner and an agency or organization prohibiting certain development activities on land with special environmental or conservation use. Based on the principal of separating land ownership rights, the easement typically permits forestry activities, while limiting construction, subdivision, mining and similar projects. Professional appraisals are necessary for IRS approval.
The easement, of course, could negatively affect the future marketability of the property. If the property is near an expanding residential or commercial area, for example, the property may later have a “higher and better use” and would have had a higher resale value without the easement. A rural property with a conservation easement that permits hunting and timber sales, however, may be minimally affected.
Conservation easement donors can qualify for a tax deduction of up to 50 percent of the taxpayer’s Adjusted Gross Income in a year. Qualified farmers and ranchers, including forest landowners, can deduct up to 100 percent. Excess donations over the 50 or 100 percent limit may be carried forward to 15 years.