Benefits of conservation easements
- Landowners retain title to their property and may continue to live on it, sell it, or pass it on to heirs, knowing that it will always be protected.
- Landowners can receive significant income, estate, and property tax benefits. (See below)
- Easements are flexible. Each easement is written to meet the particular needs of the landowner. By providing a “framework” for how the land can be used in the future, conservation easements can reduce the potential for disagreement when lands are shared with heirs.
- Easements are permanent, remaining in force even when the land changes ownership. The Barrington Area Conservation Trust ensures that all future owners honor the terms of the conservation easement.
- Easements are expertly written by the BACT staff and legal team, thus saving landowners the expense of drafting these easements themselves.
- Easements are used to protect a wide variety of land, including farms, fields, forests, lakeshores, wetlands, and scenic views, as well as green space in and around our villages.
BACT teaches private landowners about how conservation easements can help protect their properties in perpetuity, and in some instances, enjoy significant tax breaks.
A conservation easement is a legal and binding agreement between a landowner and a qualified conservation organization that enables a landowner to protect his/her land while retaining private ownership.
- Benefits of conservation easements
- Does my land qualify for a conservation easement?
- Examples of different types of conservation easements
- Sample Conservation Easement document
- Examples in our area
- Horizon Farms
- White Property Conservation Easement
- Shear Conservation Easement
- Q & A
Tax incentives for establishing a conservation easement
Income Tax Benefits
For federal income tax purposes, the value of the conservation easement donation is the difference between the value of the land with the conservation easement and its value without the easement. A certified appraiser determines these values.
For example, suppose a property is appraised at $200,000 without any restrictions, prior to the conservation easement being placed on the property. The landowner then creates a conservation easement with BACT, limiting the amount of development that can take place. The new appraised value of the property — taking into account the development restrictions in the conservation easement — lowers the property value to $125,000. The difference between these two appraisal values — $75,000 — is the value of the tax-deductible charitable gift.
As a rule of thumb, the more restrictive the conservation easement, the larger the charitable gift. A conservation easement that allows subdivision and additional development will most likely result in a lower charitable gift.
Estate Tax Benefits
Because conservation easements may lower the fair market value of the property, the value of the estate being passed on to heirs may be reduced. Therefore, estate taxes — based on the value of the property — are reduced. This can make a critical difference in the heirs’ ability to keep the land intact.
Property Tax Benefits
When you grant a qualified conservation easement in Illinois, you can receive a 75 percent reduction in the assessed valuation of your property. Properties must meet IRS criteria qualifying conservation easements as charitable contributions. Most properties of more than 10 acres in the Barrington area usually qualify for these deductions because we are located in a an area of high conservation value, as noted in state land use and wildlife plans.