What is an Easement?
An Agricultural Conservation Easement is a voluntary agreement between a landowner and a governmental agency or nonprofit conservation organization that is legally binding upon the land and future owners in perpetuity. The landowner who gives a conservation easement gives up most or all of the rights to develop and subdivide the land, now and in the future, but still maintains ownership of the land. The conservation easement protects the land from future development and requires conservation practices that assure proper care of the land so it remains usable and productive for future generations. Conservation easements are recorded in the Carroll County Land Records.
A Conservation Easement, when created has MONETARY value. Once determined, this value can be realized by the landowner in whole or in part, whether it be a “purchased easement”, a “donated easement”, or a combination of both.
How is equity received by the landowner as a result of creating an agricultural or conservation easement? In the case of a “donated easement”, equity is received by the landowner in the form of:
- A 15 year property tax credit on the land
- A charitable deduction on the Federal income tax return
- A Maryland income tax credit for the value of the easement per individual taxpayer. The credit is the lesser of $5,000 of State Income Tax in the year of the gift and 15 years carry-forward (Maximum potential credit $80,000)
- Reduced estate tax liability
In the case of a “purchased easement”, equity is received by the landowner in the form of a cash payment.