A conservation easement is a binding legal agreement between a landowner and a qualified entity (a local, state, or federal jurisdiction or a nonprofit organization recognized under Section 501(c)3 of the Internal Revenue Code) to ensure that lands are maintained in perpetual conservation. The easement ensures protection of the conservation values of a property while the owner retains ownership and use;
Specific property rights are typically removed or limited and conveyed to the easement holder. Rights commonly transferred include building construction, subdivision, mining and timber harvest limits. Remaining rights are retained by the property owner and typically include recreation use, use of existing buildings, and agricultural and forest uses;
Conservation easements do not require the landowner to allow public access onto their land;
Conservation easements are authorized by state statute (In Georgia, The Georgia Uniform Conservation Easement Act, OCGA §§ 44-10-1 to 8). Conservation easements are different from common law easements that are typically intended to benefit an adjacent property under common law. Conservation easements benefit the public at large, and not simply one parcel of land;
To qualify for tax benefits the conservation easement must be permanent. Property with a conservation easement on it can be conveyed, bought, and sold, but the terms of the easement are transferred to the new owner. Conservation restrictions that are not permanent may be part of a conservation covenant, which is part of the Conservation Use Valuation Assessment (CUVA) program administered by county tax assessors’ offices.
Conservation easements require a baseline document which provides a detailed description of the condition of the land at the time of the easement and usually include a land management plan developed with the assistance of the easement holder and/or natural resource professionals such as ecologists, wetlands biologists, and foresters.
There are about 50 land trusts operating in Georgia qualified to hold conservation easements and recognized by the IRS under Section 501(c)3 of the Internal Revenue Code, of which more than 30 are Qualified Organizations under the State's Conservation Tax Credit Program;
At least 5 state or federal agencies and some counties also hold conservation easements in Georgia;
There are over 1,000 properties and more than 300,000 acres of land under conservation easements in Georgia;
Conservation easement holders have the right and responsibility to monitor and enforce easement terms.
State of Georgia Income Tax Credit: In 2006, House Bill 1107, known asThe Conservation Tax Credit Act of 2006, was passed by the General Assembly and signed by Governor Perdue. Donations of land or conservation easements meeting state conservation purposes qualifies donors for a state income tax credit up to $250K (individual) or $500K (corporation, partnership) and the donor has 10 years to use it. The law provides for a credit on Georgia state income tax of 25% of the value donated for qualifying lands;
Federal Income Tax: For individual landowners, if the donation of the conservation easement meets the IRS requirements, it is deductible for Federal income tax purposes. Donors may deduct between 30% and 50% of their Adjusted Gross Income (AGI) (or 100% for qualifying ranchers and farmers) over 6-16 years, or until the amount of the donation is used up.
Estate Taxes: Donating conservation land or a conservation easement may reduce the value of an estate, and thereby reduce or eliminate estate taxes.
Local Property Taxes: Real estate tax assessments are based on the property’s value as determined by the local assessor. The assessed value of property may be reduced by a conservation easement, but may not due to varying approaches to assessment in each county and other tax abatement programs that may already be in effect. Check with your local tax assessor’s office to determine if an easement will benefit you with respect to local property taxes.
You can call the Georgia Land Conservation Program (GLCP) at 404-584-1101. They can answer your basic questions about conservation easements and may be able to refer you to possible easement holders such as a local land trust in your area or a public agency;
You should contact your tax advisor, real estate attorney, or accountant for good advice and information about the easement process and possible tax benefits of placing a conservation easement on your property.
You should contact a land trust or other conservation organization listed in the Resources section of this website, which can help you begin the process of placing a conservation easement on your property.