There are 12.9 million acres of commercial forestland in South Carolina. More than half of the forestland is family-owned, and 82% of private owners live on the land. The state also has about 25,000 farms, which encompass 4.9 million acres. Many landowners would like to maintain their property as farmland or forestland but are tempted to capitalize on appreciating land values as development moves towards their property. Conservation easements can help owners monetize development rights while preserving property as farmland or forestland. A conservation easement is a voluntary ...
The Court of Appeals for the First Circuit, in Kaufman v. Shulman, Docket No. 11-2017P-01A (1st Cir., July 19, 2012), reversed a Tax Court decision siding with the IRS which had disallowed a couple's conservation easement deduction. The Tax Court had disallowed the deduction because a provision in a subordination agreement with the couple's lender violated the Treasury Regulations' "extinguishment provision". The Court of Appeals reversed the Tax Court, finding that the Tax Court and IRS interpretation of this regulation was unreasonably restrictive and inconsistent with ...
Landowners may be allowed a federal income tax deduction for the contribution of a conservation easement restricting donated property. A qualified conservation contribution is a donation of a qualified real property interest to a qualified organization which is exclusively used for conservation purposes. The conservation easement must also be protected and the restrictions on the use of the property must be granted in perpetuity. The contribution must be made to governmental units, churches, schools, hospitals, or Section 501(c)(3) public charities and supporting ...
A landowner who donates a conservation easement to a qualifying organization can benefit from state tax incentives, in addition to the available federal income tax deduction. South Carolina provides an important transferable income tax credit for landowners who donate a conservation easement on property located in South Carolina. The income tax credit is equal to twenty-five percent of the amount of a charitable deduction resulting from the donation of a conservation easement.
The twenty-five percent credit is subject to several caps. First, the credit may not exceed $250 per ...