Steps to Donate an Easement

The following are the basic steps in donating a conservation easement. These may vary from land trust to land trust and region to region.

1. Landowner and land trust representative(s) meet to discuss landowner’s wishes, needs and conservation objectives. The land trust representative describes the land trust and its policies, and explains how a conservation easement works, appropriateness for the property, and any other conserva¬tion options that may be available to the landowner.
2. Landowner reviews the material, consults with family members, legal counsel, and/or tax advisors, and indicates an interest in further exploration of an easement.
3. A land trust representative visits the property to evaluate its features and the natural and open-space resources, and consults again with the owner on the easement terms and the long-term objectives. The land trust representa¬tive determines whether protection of the property serves the public interest and, (if donated), which of the various IRS public benefit tests is satisfied. The land trust conducts a baseline study to inventory and document the resource values of the property.
4. After consulting with family members, advisors, or others, the landowner reaches a preliminary agreement with the land trust on the proposed terms of the easement and property description.
5. The land trust board approves the conservation easement, making a find¬ing as to the public benefit of the easement and how it fits with the land trust’s strategic plan.
6. Landowner provides chain of title, certification of title or title report to the land trust.
7. The landowner contacts the lender, if any, to arrange for subordination of mortgage. The mortgage must be subordinated for the conservation ease¬ment to be effective and (if donated) for a tax deduction to be available.
8. Landowner determines if certain IRS requirements for an easement to be tax deductible are met.
9. Conservation easement is finalized and signed.
10. The signed easement documents, usually including the Baseline Report, are recorded at the county courthouse.
11. Most land trusts ask conservation easement donors to make a donation to the land trust to cover the costs of monitoring and enforcing the conser¬vation easement in perpetuity.
12. If the landowner intends to take a qualified tax deduction or claim a credit for the non-cash charitable gift, the landowner is responsible for hiring an independent appraiser to determine the value of the gift.
13. The landowner claims a federal income tax deduction for the donation on a special form with his or her income tax return (Form 8283). Depending on the state, there may be state and local tax savings as well.
14. The land trust has the responsibility of monitoring the property once or twice per year to ensure that all of the easement conditions are met.