The San Juan Preservation Trust gratefully accepts outright gifts of land (sometimes referred to a “fee title” gifts). Unlike conservation easements, where a private landowner continues to own the underlying land (“fee title”) while the Preservation Trust only holds an easement on the property that protects its natural values, a gift of land to the Preservation Trust conveys all rights to that parcel, including full ownership. The Preservation Trust currently owns and manages approximately 2,000 acres in fee title within its network of preserves.
Gifts of land are more straightforward than gifts of conservation easements. Property donated to the Preservation Trust outright need not have conservation value to create a tax deduction for the donor. If the property is determined to have conservation value, the Preservation Trust’s board of trustees will decide to either (a) hold it indefinitely within its networks of SJPT-owned preserves, or (b) put appropriate conservation restrictions on it, then sell or lease it with the promise to monitor the conservation restrictions in perpetuity. If the property does not have conservation value, the Preservation Trust would most likely sell the property and use the proceeds to conserve other priority properties in the San Juan Islands.
Donating ownership in land may be an excellent way to make a major tax-deductible contribution to the Preservation Trust. A donation of land allows the donor to realize immediate income tax benefits, eliminates the need to pay property taxes, and reduces future estate tax liabilities by removing the property from the donor’s estate.
Leaving a bequest of land through one’s will is also an excellent way to create a permanent legacy in the San Juan Islands and reduce the value of an estate, possibly resulting in estate tax benefits for one’s heirs.
EXAMPLE: Upon her death, Evelyn Leatham, a longtime resident of Lopez Island, left her small waterfront home and 7 acres of forest to the San Juan Preservation Trust in her will. By so doing, she removed the value of her home from her estate tax calculation. Upon receiving the property, the Preservation Trust immediately placed a conservation easement on the undeveloped portion of the land, permanently protecting the high bank “feeder bluff” shoreline and forest habitat. The house and surrounding property were then sold with the conservation easement in place. As Evelyn wished, the Preservation Trust will ensure that her undevloped land will remain in its natural state forever, and proceeds from the sale were divided between the Preservation Trust’s permanent Endowment Fund and the 2007 Campaign to Save Watmough Bight on her beloved Lopez Island.
If the Preservation Trust indicates an interest in accepting a gift of land (board approval is required), and the donor then transfers title to the land to the Preservation Trust, the full fair market value of the land is considered a charitable contribution and may be used to reduce the donor’s taxable income.
These are only examples of the tax benefits that may result from the donation of fee title gifts of land and should not to be considered as tax advice. As always, if you are contemplating making a gift of land to the Preservation Trust, you are encouraged to seek tax or legal advice.
For more information about the tax implications of private land conservation, click here.
All inquiries to the San Juan Preservation Trust are confidential and without obligation.