Questionable Conservation Easement Donations
Probate and Property, November/December 2004, Volume 18, Number 6
By Nancy A. McLaughlin
Nancy A. McLaughlin is Associate Professor of Law at the University of Utah, S.J. Quinney College of Law and serves as Associate Editor for Probate and Trust for the Real Property, Probate and Trust Journal.
Since 1980, a landowner who donates a qualifying conservation easement to a government agency or charitable conservation organization has been eligible for a charitable income tax deduction generally equal to the value of the easement under Code § 170(h). A conservation easement is a legally binding agreement between the owner of the land encumbered by the easement and the holder of the easement that restricts the development and use of the land to achieve certain conservation goals, such as the preservation of open space, wildlife habitat, or agricultural land. A landowner who donates a qualifying conservation easement also removes the value of the easement from his or her estate free of transfer tax under Code § 2522(d) and, since 1997, may potentially exclude up to an additional 40% of the value of land encumbered by the easement from the estate for estate tax purposes under Code § 2031(c).