What is the Virginia Land Conservation Tax Credit?
The Virginia conservation tax credit is a tax credit Virginia taxpayers may receive in exchange for the donation of a conservation easement or land. The credit is in the amount of 40% of the value of the donation, and unlike other states, Virginia’s credit for an individual donation is unlimited in size, and can thus be a significant incentive for land conservation.
How can I earn and use a Tax Credit?
To earn a tax credit, a landowner donates a conservation easement, or land itself, to a qualified land trust or governmental entity. In cases where the donation will create credits in excess of a million dollars, the Virginia Department of Conservation and Recreation reviews the donation to determine whether it meets certain conservation criteria, and is therefore eligible to earn a tax credit. Once the credit has been earned, the landowner may:
- Apply the credit to reduce their own state income tax liability (and carry forward unused credits for up to 10 years).
- Receive immediate compensation for the credit by transferring all or a portion of it to a third party.
To maximize your chances of earning a tax credit, it is of utmost importance to work with a professional land trust; experienced legal, tax, and appraisal advisors; and knowledgeable credit transfer facilitators.