Donating or protecting land with an easement or through ownership donation can have significant tax benefits. Three main tax areas can receive reduction: income tax, estate tax, and property tax. Tax benefits may change from year to year, but listed below are some representative figures.
Donation of an easement or property to a registered charitable non-profit, such as the Landmark Heritage Trust, will lower estate and income levels by a significant amount. For instance, federal income tax rates can be reduced by the value of the donated land or easement up to 30% of a tax-payer's income with a 5 year carry over period. The existing estate tax exclusion is up to 40% of the restricted value of land protected by a conservation easementm up to $500,000. Additionally, in large estates easements can help keep inherited lands intact, in many cases estate taxes can lead to the break-up, sale and development even when those who inherit it would rather keep them intact and unchanged. To find out more, visit the Land Trust Alliance's tax relief page.
In Maine, significant property tax reductions can be realized by placing a conservation easement on your land. Unlike other state property tax reduction programs there is no minimum area, and easements can include exactly what you want whether that be open undeveloped space, working forests, wildlife habitat, agricultural land, working farms, public access, and/or forever wild. Property tax relief can be anywhere between 50% and 95% depending upon the elements in the easement.
Please, don't hesitate to contact us if you have any questions or if you're ready to set up an easement.