Land Conservation Giving Incentive

IRS Guidance: Notice 2007-50 (PDF) More on other provisions in the Pension Protection Act affecting charitable organizations

Conservation Easement Tax Incentive
The Land Conservation Giving Incentive was enacted in 2006 as a part of the Pension Protection Act. This provision, which expired on December 31, 2007, helped to preserve farmlands and historic landscapes while allowing the land to remain under private ownership by encouraging farmers and ranchers to donate conservation easements and receive favorable capital gains deductions.

Current Status
A two-year extension of the land conservation giving incentive was enacted as a part of HR.2419, The Food, Conservation, and Energy Act. The entire farm bill became law on May 22, after the Senate followed the House’s lead and voted to override President Bush’s veto. The provision raises the charitable deduction limit from 30 percent of adjusted gross income to 50 percent of adjusted gross income for qualified conservation contributions. The charitable deduction limit is raised to 100 percent of adjusted gross income for eligible farmers and ranchers, provided that such contribution does not prevent the use of the donated land for farming or ranching purposes. Excess value of qualified conservation contributions can be carried over for up to 15 years, 10 years longer than other excess contributions may be carried forward. The IRS provided guidance ( Notice 2007-50 PDF) on the application of this provision.

Background
The Pension Protection Act of 2006 ( Pub. Law 109-280), signed into law on August 17, 2006, includes a number of charitable giving incentives and reforms. The law provided several new tax incentives to encourage greater charitable contributions, including the increase of the deductibility of donations of land and easements for conservation purposes. IS has developed a detailed summary (PDF) of the giving incentives and reforms.

Last updated: May 30, 2008