Conservation Easement Time

We are contacted frequently with questions about conservation easements and how utilizing this tax strategy can both benefit our client and the environment. Here are a few questions and answers that can shed some light on exactly how it works.

1. What is a Conservation Partnership?

A Conservation Partnership, here referred to as a “CP”, utilizes a partnership structure to bring

together landowners who want their land permanently conserved but who cannot make use of

the tax benefits generated by a conservation easement with people who are in need of these

benefits. In a CP, ownership of a subject property has been placed into a single-purpose

partnership (typically a LLC). The land has been evaluated for conservation by appraisal and

accepted by a land trust for conservation. All a conservation investor must do is purchase

shares of the partnership.

2. Why would I want to invest in a CP?

Investing partners receive their proportionate share of the tax deductions generated when the

land is conserved through the execution of a CE. Typically, the cash value of these deductions

can produce an attractive return on the initial investment, although the results will vary

depending on the individual investor’s circumstances. In addition, investors are serving to

facilitate the conservation of meaningful lands, often generating personal satisfaction from

enhancing the greater good.

3. How is a CP better for me than doing my own CE?

By participating in a CP, an investor can know in advance the amount of tax deductions they are

likely to be entitled to, and can invest an amount that will produce the amount of deductions

desired. In most cases, the tax deductions will be generated in the same year as the investment.

An interest in a CP is typically a passive investment, where the management of the land is

handled by others and the individual investors do not have further responsibilities. Also, with a

CP, an investor is simply diverting funds they would have sent to the IRS into land conservation

while generating further cash savings from the deductions received.

For more information on this years Conservation Easement availability Please click on the Contact Us Button to receive more information.