Information for Landowners
The Crested Butte Land Trust is grateful for the efforts and vision of over 50 different families who have voluntarily protected their lands.
Whether you want to maintain ownership, sell, or donate your land for protection, there are plenty of options for permanently protecting your land.
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Your choice of which technique to pursue depends upon your goals for the property, the natural characteristics of the land, and your financial objectives, including income and estate tax planning.
If you would like more information about your options as a landowner, or would like to arrange for the Crested Butte Land Trust to conduct a site visit and discuss land protection options, please contact Ann Johnston, Executive Director, at 970.349.1206 or at director@cblandtrust.org. All inquiries will be treated with confidence, and without obligation.
Conservation Easement
A legal agreement between a landowner and a land trust that permanently limits uses of the land in order to protect its conservation values. It allows you to continue to own and use your land and to sell it or pass it on to heirs.
Conservation easements provide great flexibility. Landowners and land trusts, working together, can write conservation easements that reflect both the landowner’s and the land trust’s goals.
An easement on property containing rare wildlife habitat might prohibit any development, for example, while one on a ranch might allow continued ranching and the building of additional agricultural structures. An easement may apply to just a portion of the property, like a trail easement. Easements need not require public access.
A landowner sometimes sells a conservation easement, but usually easements are donated. If the donation benefits the public by permanently protecting important conservation resources and meets other federal tax code requirements it can qualify as a tax-deductible charitable donation. The amount of the donation is the difference between the land’s value with the easement and its value without the easement. Placing an easement on your property may or may not result in property tax savings, and the land trust recommends each landowner receive their own professional and legal advice.
Perhaps most important, a conservation easement can be essential for passing land on to the next generation. By removing the land’s development potential, the easement lowers its market value, which in turn lowers estate tax. Whether the easement is donated during life or by will, it can make a critical difference in the heirs’ ability to keep the land intact.
Bequest
The donation of fee title or a conservation easement to a qualified conservation organization at time of death, as provided for in a will, results in the unrestricted use of land by the owner until death, as well as a reduction of estate taxes.
Leaving land to the Crested Butte Land Trust in your will allows you to retain full use and control of the land during your lifetime, yet ensures its care after you are gone. The disadvantage to the owner is the continued full property tax liability and the loss of income tax benefits for the donation. Because the gift must be formally accepted after your death, we urge you to share your plans with us in advance so that we may assure you that the gift meets our criteria for acceptance.
Fee Donation
If your land has significant conservation values, and no heir is available to protect your land; or if you own highly appreciated property, or have substantial real estate holdings which may result in high capital gains or estate tax burdens, a donation of land to a qualified conservation organization such as the Crested Butte Land Trust may be an attractive alternative.
All rights to the land are transferred to the Crested Butte Land Trust, resulting in an income tax deduction for the full appraised value of the land, reduced estate taxes, and reduction of property taxes.
Leaseback
Property is donated to a qualified conservation organization, but with the condition that the granting owner leases back use of the land. Such a condition placed on the gift may preclude any tax deduction for the donation.
Reserved Real Estate or Remainder Interest
Property is donated or sold, in whole or in part, to a qualified conservation organization with a deed provision that reserves the right of the owner (and/or specified persons) to use the land or a portion of it, until death. The owner may claim an income tax deduction for the value of the donation, estate taxes may be reduced, and property taxes are levied only on that portion of the land retained for personal use.
Market Value Sale
The landowner sells a property a full market value, and is liable for any income/capital gains taxes. Often it is challenging for land trusts to find granting sources to fund market value sales, so offering a bargain sale can be an attractive alternative which can increase the likelihood that funding can be obtained for the sale.
Bargain Sale
A bargain sale is structured by a landowner offering to sell a property at less than full market value to a qualified conservation organization. A bargain sale also offers potential income tax benefits to the seller, as the difference between the appraised fair market value and the sale price is considered a tax-deductible charitable contribution.
Conservation Development
Provides protection for portions of a property either through a conservation easement or through other means, while allowing for development of the remaining property. Limited development arrangements can simultaneously yield tax savings for the donation of the conservation easement and enhance the value of the adjoining land to be developed.
Tradelands
The Crested Butte Land Trust may accept properties which are not considered of high conservation value, yet would provide significant financial support which would be leveraged to increase our conservation work. The purpose of accepting these lands would be with the intent to resell them. The proceeds from these sales benefit additional land protection projects and other programs of the Crested Butte Land Trust.
