Donating Conservation Easements

Do you want to see your land stay in agriculture forever?  Protecting unique farmland through the generous donation of a conservation easement will protect the unique character of agricultural communities in Alaska while ensuring that we will have an agricultural future in the state.  Protect the land that you love while having the potential to see tax benefits for you donation of a conservation easement. Landowners can make this donation of conservation easement part of their planned giving strategy.

 

The current and successive owners continue to own, manage and pay taxes on the land. You can continue the uses of the land you agreed to retain. You decide whether or not to allow public access and, if so, on what terms. Your property is still private. You can pass it on to the next generation, sell it, trade it – you retain all the rights of ownership, except those you voluntarily gave away in the conservation easement.

Those rights you voluntarily gave away will be protected by the Alaska Farmland Trust. Our land trust will monitor your property at least once a year to ensure the agreements made in the easement are being kept. If necessary, the Alaska Farmland Trust will defend the terms of the conservation easement in court.

At the Alaska Farmland Trust, we recognize the incredible value of the donation of a conservation easement.  Generally the costs associated with closing a conservation easement include:

  1. Appraisal Costs
  2. Survey
  3. Legal Costs to review conservation easement
  4. The AFTC also request the landowner to assist with cost of baseline documentation.  A Baseline Document is required by the AFTC for the purpose of establishing the condition of the land at the time the conservation easement is granted.  The typical cost for a baseline report is between $1,000-$1,500
  5. Stewardship Endowment costs (these costs go towards managing the conservation easement over time.)
  6. Closing and Recording Costs

Who pays for what is generally negotiated on a case-by-case basis based on the value of the conservation easement and unique situation of each donation. Please contact us to begin the process.

Landowner who donate conservation easements may be eligible for federal income tax deductions. Charitable deductions can be applied towards offsetting income and capital gains taxes, and looking further down the road, will reduce the potential for future estate taxes.

To determine the value of a conservation easement, and the charitable deduction associated with the donation an independent appraisal process is needed.

How this works:

  • Step 1. Conservation Easement is prepared identifying the resources that will be protected, while identifying areas that will be used in the future for any buildings etc.
  • Step 2. Landowner consults with tax accountant or attorney about the donation and subsequent tax deductions.
  • Step 3. Landowner seeks an independent appraisal of the property to determine the value of the gift.

Of Special Note:

There are very specific IRS criteria for charitable deductions for conservation easements. This includes, but is not limited to the qualifications of the appraiser, the timing of the appraisal to closing, and the exact nature of the resources being protected etc.  Our office can help make you aware of all the IRS requirement before beginning the process.

Conservation Easements are drafted to contain and protect the unique attributes of the property.  Most agricultural conservation easements that we handle are created to protect high quality agricultural soils. When drafting the conservation easement, we will work with the landowner to determine what future plans or family interests might happen on the property. This might include sites for future barns, houses and other structures.

Generally we will work with interested landowners looking to donate an easement on 10 acres or more.  There are occasions where will work to conserve smaller parcels if the proper has unique features and resources or has a big significance to a community.  Call us today to determine if your property would qualify.