There may be significant tax benefits for donating your land, a conservation restriction, or selling at a price that is below market value to Greenbelt.
Many factors determine the type and amount of tax benefits you can qualify for, including your income, the value of your donation, and how long you have owned the land. Greenbelt recommends
that all landowners consult with an experienced attorney and qualified tax advisor before conserving your land.
Federal Income Tax Deduction
Under IRS regulations, the full fair market value of donated land or a conservation restriction is tax-deductible as a charitable contribution on your federal income taxes. Conservation
Restriction donors can deduct up to 50% of their Adjusted Gross Income per year (100% if they are qualifying ranchers and farmers) and have a total of 16 years to use up the entire deduction.
Donors of land can qualify for an up to 30% deduction of their AGI and have a total of 6 years to use up the deduction. A gift may also help reduce capital gains taxes.
Massachusetts Conservation Land Tax Credit
Massachusetts offers a refundable state income tax credit of up to 50% of the fair market value
of donated property, up to $75,000 – even if you live out of state or don’t have to pay state income tax. If your state income tax liability is less than $75,000, the credit is
paid out to you in cash. Please contact us for more information and to see if your land qualifies for the tax credit.
Reduce Estate Taxes
Any property transferred from your estate (at or before the time of death) to Greenbelt exempts the value of that property from state and federal estate taxes. In addition, a CR granted
within a certain time frame by your heirs can also reduce estate taxes. By reducing your estate’s value, estate taxes will be lower, potentially enabling other property to remain in the
family instead of being sold to pay estate taxes.
Property Tax Relief
If your conservation restriction substantially reduces the development potential of your property, your local assessor should revalue your property to take the restriction into account, thus
lowering your property’s assessment.
Offset Capital Gains Taxes
Your charitable donation or sale may help you offset capital gains taxes.