Press Releases      

June 11,2008
 
Sky-high crop prices, record farm income and soaring land values threaten serious income tax and estate tax problems for landowning families. Fortunately, a win/win combination of a wellhidden Farm Bill provision and innovative private enterprise could reduce or even eliminate the threat. Otherwise, that threat could force landowners or their heirs to sell land to pay taxes.

The Farm Bill help comes from Sec. 15302 of Trade and Tax Title XV which provides “Two- Year Extension of Special Rule Encouraging Contributions of Capital Gain Real Property for Conservation Purposes.” This one-liner extends the Pension Protection Act of 2006 which created generous new rules for conservation easements. That act expired last December – which created a flood of last-minute applications for easements last fall. The flood was so great, time ran out for many applicants. But if you missed the Dec. 31 deadline, you’re in luck. The Farm Bill extends all the benefits until Dec. 31, 2009, retroactive to Jan. 1, 2008.

Under the extension, the 2.1 million owners of over one billion acres of cropland, pasture and rangeland and the 10 million owners of 430 million acres of forest can cut taxes by creating a “conservation easement.” The first benefit is that all taxpayers can deduct up to 50% of their annual adjusted gross income (AGI) for donations of conservation easements and carry forward their deduction for up to 15 years – or deduct up to 100% of annual AGI for up to 15 years if they are working farmers or ranchers.

In concept, conservation easements are simple. You give up specific development rights in perpetuity while maintaining ownership rights, the right to farm, to log, to hunt, etc. The public enjoys the benefit of having your land maintained as forest or agricultural land rather than being turned into another housing development or industrial park. In return, you reap both income tax and estate tax benefits – and the estate tax benefits carry on to future generations.

In practice, conservation easements are highly complex because each easement is a separate case, requiring experienced attorneys and appraisers. (To see how complex it can get, here’s an example)

That complexity is where private enterprise enters the picture in the form of soft-spoken Amos Eno, a long-time Washington, D.C. policy pro who founded and runs the non-profit Resources First Foundation (RFF). Eno’s RFF is based in Yarmouth, Maine but literally covers the entire United States with an interactive web of free Internet research and mapping tools.

Whether you’re a working farmer or rancher, or an absentee owner, RFF’s various Internet tools provide one-stop-shopping for a broad array of land-management services. Enter the RFF world by clicking RFF’s main site Private Landowner Network (PLN). That’s the doorway to a wealth of free information, including:

• RFF’s Tax Planning and Estate Management section,
• a comprehensive guide to Land Conservation Grant & Assistance Programs,
• the easy-reading PLN Library of helpful articles,
• the Land and Energy Conservation Toolbox which includes energy-saving information on Tillage, Nitrogen, Irrigation and Animal Housing, and, 
• the Conservation Yellow Pages where you enter your zip code to “find local, regional or national professionals to assist you with your tax, estate, or conservation objectives.”
• If you’re an attorney or other professional dealing with tax or conservation issues, you can add your name and contact information to the RFF database.

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Contact:
Laura Dover
207-221-2753
lmass@resourcesfirstfoundation.org