VOLUME 16 // ISSUE 1 Winter 2016
NORTH CAROLINA COASTAL LAND TRUST
COASTLINES A Wild Place Saved
tax News
Federal Conservation Easement Tax Incentives Made Permanent According to national studies, when enhanced federal tax incentives were first put in place, the pace of land conservation increased by about 33 percent, or one million acres per year! In December, Congress PERMANENTLY extended the enhanced federal income tax deduction for donations of conservation easements. First established in 2006, the enhanced incentive expired in 2014. Now, with the incentive renewed and made permanent, an important tool for land trusts has been restored.
The Murray Tract, our newest nature preserve, lies along the Northeast Cape Fear River in Pender County. Learn about this wild place on page 4.
Dirt to Dollars! Program: Trade Land FAQ’s What is a “Trade Land”? We use the term “Trade Land” for real estate with little or no conservation value that is donated to the Coastal Land Trust to be put on the market and sold. Examples include first and second homes, condos, vacant land, subdivision lots, and commercial property. The sales proceeds are then used by the Coastal Land Trust for its conservation programs.
When should I consider donating a Trade Land? If you own real estate without conservation values, which you no longer wish to maintain; and you do not want to sell your property yourself; If your land has risen in value, and you can utilize an income tax deduction for the current fair market value of your property.
Why should I choose the Coastal Land Trust for a Trade Land donation? We know real estate! Other charities, even large ones, may be unfamiliar with the complex legal, title, environmental and appraisal issues involved in real estate donations, but it’s
www.CoastalLandTrust.org
what we do every single day. It’s a great way to transform unproductive real estate assets into the conservation success stories you’re committed to as a member of the Coastal Land Trust!
The expanded federal tax deduction is especially welcome in North Carolina, where the popular state conservation tax credit was abolished by the General Assembly at the end of 2013. Land trusts throughout the state reported that 2013 was a banner year for conservation transactions, followed, unfortunately, by dramatic decreases in 2014 and 2015. The North Carolina Coastal Land Trust has a similar story to tell. Landowners and our lawyers literally raced to the courthouse in December 2013. We protected an astonishing 12,180 acres of coastal habitat in 2013, but 670 acres in 2014 and 2,990 acres in 2015. TAX, continued on page 3
Does it really work? You bet! In November 2014, the Coastal Land accepted a donation of a vacant lot near Calabash in Brunswick County; we had it appraised, listed it with a realtor, and seven months later it was sold. In the past, we’ve also received subdivision lots in Guildford County (in 2000) and vacant land in Lenoir County (in 2011). In each case, the owner’s gift of non-conservation real estate resulted in a substantial charitable contribution to the Coastal Land Trust.
Can I leave the Coastal Land Trust a Trade Land in my Will? Yes; for example, a supporter’s will named us and several others to receive the proceeds of her home in Raleigh after its sale by her executor. Just make certain to include language specifying your intent
How Does It Work? The conservation easement incentive: • Raises the maximum deduction a donor can take for donating a conservation easement from 30% of their adjusted gross income (AGI) in any year to 50% • Allows qualified farmers to deduct up to 100% of their AGI • Increases the number of years over which a donor can take deductions from 6 to 16 years. Example: Without the enhanced easement incentive, an agricultural landowner earning $50,000 a year who donated a conservation easement worth $1 million could take a total of no more than $90,000 in tax deductions. Under the enhanced incentive, that landowner can take as much as $800,000 in tax deductions!
TRADE LANDS, continued on page 3
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