Text Box: Iowa landowners who are contemplating voluntary conservation agreements on their land just received a huge incentive to act sooner rather than later. On Aug. 17, President George W. Bush signed federal legislation (the Pension Protection Act of 2006) that significantly expands the tax incentives for donations of conservation easements to conservation organizations.  Specifically, the new legislation: raises the charitable deduction landowners can take for donating conservation easements from 30% to 50% of their adjusted gross income in any year; increases the deduction limit to 100% of income if the donor is a farmer or rancher; allows a conservation easement donor to carry forward the charitable deduction for up to 15 years; and limits these expanded incentives to only those donations completed by Dec. 31, 2007. “The new law is a great opportunity for owners who have special land and are willing to place meaningful restrictions to protect it,” said Mark Ackelson, president of the Iowa Natural Heritage Foundation (INHF). INHF is a nonprofit conservation organization that is an approved recipient of such easements. Other private and public conservation groups that can accept easements include The Nature Conservancy, Text Box: County Conservation Boards, the Iowa Department of Natural Resources and others. Iowa’s Senator Chuck Grassley, chair of the Committee on Finance, played a large role in the legislation’s content and passage. His committee has been involved in a multi-year effort to find and punish people who seek worthless or inflated values of conservation easement donations purely as a tax dodge, while providing extra rewards to those whose donations have significant conservation value. Ackelson explains how the new tax laws work: “Let’s say that Joe and Mary Landowner own 200 acres of scenic woodland in a highly developable area. They decide to donate a permanent conservation easement that, for example, removes development and limits future timber harvests according to a woodland management plan. A qualified appraiser values those donated rights at $1 million. If the couple earns most of their income—say $50,000 per year—from farming or ranching, they can now deduct that entire $50,000 from their income tax forms during the donation year and the next 15 years to come.” According to Ackelson, most land protected by conservation easements remains in private ownership and is not open to public access. “Though these sites remain in private ownership, their owners have established permanent restrictions that protect real public benefits: scenic views, wildlife habitat, water quality and more,” notes Ackelson. Ackelson adds that not all land and not all landowner goals fit this program, and his Text Box: New tax law rewards conservation donors

Landowner Fire Ecology Workshop

2 & 3

Shelterbelts

4

Feature Plant and Animal

5

New Tax Law Continued...

5

Prairie Volunteer Work Day

5

Volume 2, Issue 4

January 2007
Text Box: Loess Hills Conservation Text Box: Newsletter Funded By: the Loess Hills Alliance, Mills County Soil & Water Conservation District, West Pottawattamie County Soil & Water Conservation District, and the Iowa Department of Natural Resources