Gift Your Land
Donating your land, also known as a fee simple transfer to a non-profit conservation organization or to a government agency is the simplest way to protect land. It is only necessary to obtain acceptance from OCT, to whom the land will be donated, prior to deeding the land. A gift ensures the perpetual protection of the land. The donor receives tax benefits in the form of federal income tax deductions, potential estate tax benefits, and relief from property taxes. The donor is also relieved of management responsibilities and automatically absolved of liability associated with any trail use.
375+ acres (82 percent) of the properties preserved by the Orleans Conservation Trust were donated. Typically, the only cost to the land donor is for an appraisal which certifies the value of the donated land for federal income tax deductions. Appraisals are only needed when the claimed value of the deduction is more than $5,000. OCT typically asks donors to pay remaining property taxes on the land before it becomes tax exempt in the next fiscal year.
Establish a Conservation Restriction
People who grant Conservation Restrictions share a desire to protect and enhance forever the natural scenic and cultural resources of the community. Since 1970, OCT has worked with 36 families, placing more than 175 acres under conservation restrictions.
What is a Conservation Restriction? A conservation restriction (CR) is a legal agreement between a property owner and a land trust (or government entity) permanently restricting the uses and activities that may take place on all or a part of a property in order to protect the land’s conservation values. Each CR is tailored to the property, the interests of the owner, and the policies and purposes of the restriction holder.
The property owner continues to own the land, and can sell it or pass it on to heirs. The CR “runs with the land”- meaning the original owner and all subsequent owners are bound by the restrictions. The CR is recorded at the Barnstable County Registry of deeds so that all future owners and lenders will learn about the CR when they obtain title reports.
Why Grant a CR? People grant CRs to protect their land from inappropriate development while retaining private ownership. By granting a CR in perpetuity, an owner may be assured that the resource value of the property will be protected indefinitely, no matter who owns the property in the future.
How Restrictive is a CR?
A CR limits uses and activities to the degree necessary to protect the significant conservation values of the property. Sometimes this totally prohibits construction, sometimes it doesn’t. A CR offers great flexibility.
Must a CR Allow Public Access? Landowners who grant CRs make their own choice about whether to open their property to the public.
How Can Donating a CR Reduce a Property owner’s Federal Income Tax? The donation of a CR may be a tax-deductible charitable gift, provided the CR is perpetual and is donated exclusively for conservation purposes to a qualified conservation organization, such as OCT.
How is the Income Tax Deduction Calculated? To determine the value of the CR donation, the owner hires an appraiser, who determines the fair market value of the property “as-is”, meaning without the CR in place, and the fair market value of the property as restricted with the CR. The difference in these two values is the value of the CR donation. For a CR recorded in 2011, the income tax deduction can be claimed against 50% of the owner’s adjusted gross income each year for up to sixteen years.
Can Granting a CR Reduce Property Taxes? Property tax assessment is usually based on the property’s market value, reflecting the development potential of the property. If a CR reduces that potential, it will reduce the assessment, and, thus, the property taxes.
How Can Granting a CR Reduce a Property Owner’s Federal Estate Tax? A CR can be used as an estate planning tool to reduce estate taxes. If the landowner has restricted the property by a perpetual CR before his or her death (or the executor restricts it after death), the property must be valued on the estate at its restricted value. Thus, the value of the estate will be less, and estate taxes will be reduced.
Leave a Legacy
For some land conservation supporters, a bequest is the most realistic way of making a significant gift to OCT. You may provide for the OCT by creating a new will, adding a codicil to your present will, including OCT in your revocable trust, or by designating OCT as the beneficiary of your retirement plan or insurance policy.
To ensure that your exact intentions are carried out, wills, codicils, and trusts should be prepared by and with the advice of your attorney. Mark Robinson, the Executive Director of The Compact of Cape Cod Conservation Trusts, who advises OCT and potential donors, is available for additional information on the various methods of designating a bequest to OCT or for guidance in planning a gift.
A bequest or beneficiary designation should be made payable to the “Orleans Conservation Trust”. Unless otherwise specified, a bequest to the “Orleans Conservation Trust” is interpreted as an unrestricted donation to OCT, to be used in any way to serve any of its purposes.
Sample Bequest Form
A general bequest, unrestricted as to purpose:
“I give (____ dollars) or (____ percent of my estate) to the “Orleans Conservation Trust” (federal tax I.D. number: 24-7418072), a Massachusetts charitable corporation having an address at 51 Main Street, P.O. Box 1078, East Orleans, Massachusetts, for the benefit of the Orleans Conservation Trust, and for its general purposes.”
Sample Bequest Form
An endowment bequest for a specific purpose:
“I give (____ dollars) or (____ percent of my estate) to the Orleans Conservation Trust., (federal tax I.D. number: 24-7418072), a Massachusetts charitable corporation having an address at 51 Main Street, P.O. Box 1078, East Orleans, Massachusetts, for the benefit of the Orleans Conservation Trust, and for (state the purpose). If, in the future, in the opinion of the Orleans Conservation Trust, all or part of the income of this fund cannot be usefully applied to the above purpose (or in the above manner), it may be used for any purpose within the powers of Orleans Conservation Trust that will most nearly accomplish my wishes and purposes.”
So that we can help you make sure that your intent will be realized by your provision, we would be grateful if you would mail a copy of the pertinent portion of your estate documents after your plans are finalized to OCT, P.O. Box 1078, East Orleans, MA 02643. We will respect the sensitive and confidential nature of any material you provide. The Compact of Cape Cod Conservation Trust’s and OCT are available to consult with you and your advisor about bequests and other forms of charitable giving that may benefit you, your family, and land protection advanced by OCT. If you or your advisors have questions, please call us at 508-255-0183 or email email@example.com.
Thank you for considering the Orleans Conservation Trust.