What is a conservation easement, or land preservation agreement? (printable brochure)
From the Land Trust Alliance (www.lta.org),
"A conservation easement (or conservation restriction) is a legal agreement between a landowner and a land trust or government agency that permanently limits uses of the land in order to protect its conservation values. It allows you to continue to own and use your land and to sell it or pass it on to heirs.
When you donate a conservation easement to a land trust, you give up some of the rights associated with the land. For example, you might give up the right to build additional structures, while retaining the right to grow crops. Future owners also will be bound by the easement's terms. The land trust is responsible for making sure the easement's terms are followed.
Conservation easements offer great flexibility. An easement on property containing rare wildlife habitat might prohibit any development, for example, while one on a farm might allow continued farming and the building of additional agricultural structures. An easement may apply to just a portion of the property, and need not require public access.
A landowner sometimes sells a conservation easement, but usually easements are donated. If the donation benefits the public by permanently protecting important conservation resources and meets other federal tax code requirements it can qualify as a tax-deductible charitable donation. The amount of the donation is the difference between the land's value with the easement and its value without the easement. Placing an easement on your property may or may not result in property tax savings.
Perhaps most important, a conservation easement can be essential for passing land on to the next generation. By removing the land's development potential, the easement lowers its market value, which in turn lowers estate tax. Whether the easement is donated during life or by will, it can make a critical difference in the heirs' ability to keep the land intact."

How can you protect your land?  Conservation Easement or Restriction, Land Donation by Will, Donate a Remainder Interest in Land, Charitable Gift Annuity, Bargain Sales, and other methods.

What else can I do? The way you garden can enhance your property and support native species and natural communities. For a brochure with more information, click here.

Tax Incentives:
(From Land Trust Alliance)
Federal and State Income Taxes: Gifts of land or conservation easements to a qualifying charitable conservation organization like the Middlebury Area Land Trust (MALT) may qualify as a charitable deduction from adjusted gross income. The amount of the deduction is determined by the appraised value of the gift. In the case of a gift of a conservation easement, the appraisal estimates the difference between the fair market value of the property without restrictions and the fair market value of the property with development restrictions. This type of contribution is known as a gift of appreciated property. Under the internal Revenue Code, a taxpayer may take a deduction of up to 30% of his or her adjusted gross income for this type of contribution. Any amount donated in excess of this limitation may be carried forward for up to five years subject to the same limitation in each of those five years.

Requirements For Charitable Deductions:  In order to qualify as a charitable contribution, the donation of a conservation easement must convey "public benefit". The IRS requires that an easement meet at least one of the following criteria:
- The easement should preserve land for recreational or educational use by the general public;
- The easement should protect a relatively natural habitat of fish, wildlife, or plants, or similar ecosystem;
- The easement should preserve open space (including farm or forest land) if such preservation is 1) pursuant to a clearly delineated federal state or local policy; or 2) the preservation is for the scenic enjoyment of the public;
- The easement should preserve a historically important land area or certified historic structure.

Appraisals: In order to claim an income tax deduction, the value of the conservation easement must be determined by a qualified appraisal. The appraiser you choose should have experience with development rights appraisals since it is possible that the Internal Revenue Service will look closely at your claim. The MALT can provide you with a list of appraisers who have done such work.
A development rights appraisal includes, among other things, a description of the property, the method of valuation used to determine the fair market value of the property, certain information about the appraiser and his or her qualifications, and a description of the fee arrangement between the donor and the appraiser. A "fully completed appraisal summary" must be reported on IRS form 8283 and attached to the donor's income tax return.

Property Taxes: In addition to income tax savings, land restricted by a conservation easement has a reduced value which can reduce the amount of property tax on that land. Individuals should check with their town or city tax assessment office for details.

Estate Taxes: Conservation easements usually lower the value of the landowner's estate, therefore reducing estate and inheritance taxes. Families have found that a conservation easement enables them to keep lands which otherwise might have to be sold to pay estate taxes.

Tax Counseling: If tax reduction is an important factor, the MALT recommends that a landowner consult with a tax advisor before proceeding with the donation of an easement.

Information for Land Developers:

Are you interested in working with a land trust to establish smart development of communities? Communities can make choices which balance various aspects of development. Social, economic, and ecological concerns can all be integrated if local governments create efficient strategies for land use that are far-sighted. Many regions in the country are working on urban development boundaries that restrict growth in certain areas, which preserves open farmland. Growth within these boundaries is done in such a way to lower housing costs, increase public transport systems, which can rejuvenate town centers, improve quality of life, and create a stronger community.