A provision in the federal Consolidated Appropriations Act of 2016, HR2029, which was signed into law in late December, makes the tax incentive for conservation easement donations permanent. The incentive will be applied retroactively to take effect Jan.1, 2015. Making the tax incentive permanent has been a priority for conservation interests for a decade, and it represents a huge win for conservation, for landowners and for the land trust community.
This new law also reauthorized the Land and Water Conservation Fund for three years and increased its annual funding from $306 million to $450 million.
The Enhanced Incentive in this newly passed law helps landowners choose conservation by:
• Raising the maximum deduction a donor can take for donating a conservation easement from 30% of their adjusted gross income (AGI) in any year to 50%;
• Allowing qualified farmers and ranchers to deduct up to 100% of their AGI; and
• Increasing the number of years over which a donor can take deductions from 6 to 16 years
The conservation tax incentive has been a success in increasing the pace, quality and permanence of land conservation.
• Since the enhanced incentive first passed in 2006, roughly one million acres have been conserved per year with easements managed by the nation’s 1,700 community-based land trusts.
• Through an enhanced tax deduction, landowners can voluntarily place their most prized assets – historical sites, forests, family farms and ranches – in easements to ensure a legacy of natural abundance, enjoyment and agricultural production for future generations.
• Land placed in easements can be farmed, grazed, hunted or used for recreation and the conservation of natural resources. It can also be passed on to heirs or sold. But the land is kept safe from future development, ensuring that today’s natural treasures don’t become tomorrow’s strip malls and convenience stores.
• Making the enhanced incentive permanent is about ensuring a legacy. Land tells the story of our nation, providing both a window to the past and a key to a healthy and secure future.
• 65 national organizations – ranging from The National Audubon Society, Ducks Unlimited, American Farm Bureau Federation and the Environmental Defense Fund – supported permanent enactment of the enhanced incentive.