Today, a public benefit could include simply preventing further strain on a public water supply. Greater development pressures and fewer larger parcels are reducing the scale of land conservation techniques. In general, the amount of the income tax deduction for a conservation easement reflects the value of the development rights that you gave up in granting the easement. The gift of a conservation easement is also a charitable contribution, which you can deduct from your income taxes. The amount of the deduction in one tax year may be limited to 30 percent of your adjusted gross income, but you can carry forward any excess deduction for up to five years.
Estate taxes are an important factor, too.
More families that own land are finding that their property has become so valuable that they might be forced to sell some or all of it just to cover estate taxes when the family member who owns the property dies. A conservation easement reduces the value of property by giving up development rights. These rights typically are given up in a deed to a nonprofit charitable organization. Their value is then deducted from the market value of the property for estate tax purposes. The difference can be enough for some families to reduce or avoid estate taxes altogether.