Donations of Land:

Methods of Preserving Land

Outright Gift of Land

The simplest way to conserve your land is by outright property donation to a qualified conservation organization, like AVIS. A generous gift of real estate will maximize your income and estate tax deductions avoiding capital gains taxes.

Donating land may be attractive to landowners who:

• Treasure their property and want to see it preserved for the common good
• Own property they no longer wish to use
• Own highly appreciated property, the sale of which would prompt a high capital gains tax
• Own substantial real estate holdings and wish to reduce property and estate tax burdens
• Recognize that greater expertise is needed to protect and manage the land
• Have no heirs willing or able to protect the land’s conservation values

Outright donations of conservation land offer several advantages:

• Ensure the permanent protection of your land
• Simple transactions
• Provide maximum income and estate tax benefits
• Transfer ownership and management responsibilities to a nonprofit organization or government entity

Conservation Restriction

A conservation restriction is a legal document recorded at the Registry of Deeds that allows you to control the future use of your land by limiting the type and scope of development on your property.

Potential Benefits for Landowners offered by Conservation Restrictions:

• Provides permanent property protection, applying to all future landowners.
• A land trust or government agency monitors and enforces the restriction over time.
• Landowners retain title to their property and may continue to live on it, sell it, or pass it on to heirs, knowing that it always will remain protected.
• Aid in estate planning, reducing estate taxes that could force the sale of family lands. Donated easements also can provide a charitable income tax deduction.
• Can reduce property tax by eliminating unwanted but highly valuable development potential.
• May minimize family conflicts when lands pass to the next generation.
• Can allow for limited development, allowing landowners to generate financial returns while protecting critical conservation resources.

Bargain Sale

Several techniques help us to stretch conservation dollars while providing some compensation for landowners. A bargain sale, where property is conveyed at less than its fair market value, increases the chance that a conservation organization can purchase it. While a bargain sale may produce a smaller financial return than a sale at fair market value, the loss can be somewhat offset by tax savings. The tax law treats a bargain sale as being part taxable sale and part charitable donation. The sale is subject to capital gains tax while the charitable donation results in an income tax deduction.

This information is condensed from the web site of the Essex County Greenbelt Association – see http://www.ecga.org for more information on this subject

Thank you!

For more information, please contact members@avisandover.org.