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Tax Benefits

Land Conservation, Tax Credits, Estate and Succession Planning

Voluntary private land conservation is the foundation of the land trust society being developed in our community. Landowners whose lives and livelihoods have been connected to the land often wish to ensure some continuity of the values that have become important to them. Such values, to name a few, might include agricultural uses, natural components such as native grasslands, riparian areas or forested areas, archaeological or historical elements.

In many cases privately owned land provides multiple uses that might include typical economic outputs such as grain, livestock, farm/ranch vacations, etc., but also may include increasingly well recognized public benefits such as healthy watersheds, attractive viewscapes and robust wildlife and nature.

Communities and individuals engaging in the conservation of such values have been recognized by federal and provincial governments as important contributors to our quality of life. One of the tangible indications of such recognition is the availability of income tax credits or deductions for a variety of interests in privately held land. If the land is determined to be ecologically sensitive the resulting tax treatment of any land interests donated in whole or in part to a qualified recipient such as a land trust society are fairly attractive and attract no capital gains tax. Many landowners have chosen to use a tool such as a Conservation Easement (CE), a type of interest in land, as a way to facilitate estate and succession planning.

The Conservation Easement is a voluntary covenant between the landowner and land trust by which certain rights such as subdivision, conversion of native landscapes or further development may be restricted or foregone in exchange for a tax credit against which farm or other income may be offset. As the trustee of such interests the land trust society has an obligation to foster the interest with the landowner(s) who in most cases would retain core rights to enable continuing operations for current and subsequent generations. The terms and restrictions of CEs vary considerably and are dependent on an array of factors, including the nature of the land in question, the motivations and interests of the owners(s) and the mandate and capacity of the land trust society. Accordingly, until the details of such a transaction are worked out there is no appropriate way of determining the probable size of a tax receipt.

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