The Conservation Easement Incentive Act of 2013

The Conservation Easement Incentive Act of 2013, H.R. 2807 proposes to increase the contribution base limit on gifts of Conservation Easements from 30% to 50% of the donor's contribution base. "Contribution base" is the adjusted gross income of the donor, excluding any net operating loss carryback from the year of contribution of the Conservation Easement. The Bill also proposes to permit qualified farmers and ranchers to deduct up to 100% of their contribution base. In addition, the Bill proposes to increase the carryover for unused tax deductions from the current 5 years to 15 years.

Sponsored by Rep. Mike Thompson (D-Cal.) and Rep. Jim Gerlach (R-Pa.) with over 135 co-sponsors from both parties, the Act has been referred to the House Ways and Means Committee for consideration. If the Bill survives at the committee level and successfully makes its way through the entire legislative process and is signed by the President, it would enhance and make permanent the tax advantages associated with gifts of Conservation Easements noted above. It is important to note that both Rep. Thompson and Rep. Gerlach are members of that Committee, although it is impossible to know what impact that will have on the Bill.

Conservation Easements provide an opportunity for landowners to impose restrictions on their land by limiting certain types of property uses, such as development or mining of minerals, and preserve the land for open space or related purposes, while maintaining the private ownership of the land. Donors of Conservation Easements may receive Land Preservation Credits in Virginia, as well as federal income tax deductions.

Spotts Fain publications are provided as an educational service and are not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel.