Conservation Options
The following represents a range of conservation options available to landowners that can be used alone or may be blended to help you achieve your objectives.
- Land Donation
- Conservation Easement
- Purchase of Development Rights
- Transfer of Development Rights
- Bargain Sale
- Limited Development
- Charitable Remainder Trust
- Reserved Life Estate
- Family Limited Partnership
- Like-Kind Exchange
- Tax-exempt Installment Sale
- Participation in Agricultural District
- Testamentary Gift
- Fair Market Purchase
Land Donation: An outright donation of land to a municipality
or a qualified conservation organization, which permanently protects land
from development, provides the donor with a charitable gift income tax
deduction, and is a good estate planning tool by removing the asset from
the estate. (Learn more about the 
Procedures
for Making Gift of Land.)
Conservation Easement: A conservation easement is a voluntary
agreement between a landowner and a qualified conservation organization
or municipality that protects the land from development. The landowner
retains ownership and the remaining rights to use the land, sell it, or
pass it on to heirs. If donated for conservation purposes in perpetuity,
an easement is a tax-deductible charitable gift and may substantially reduce
estate taxes. (Learn more about Conservation
Easements and the Procedures
for Making Gifts of an Easement to the Trust).
Purchase of Development Rights (PDR): In a PDR transaction, a landowner voluntarily agrees to sell all, or a portion of, the development rights on his or her land to a municipality. The landowner retains the right to use, sell, and pass the land on to heirs. The sale provides cash to the landowner, reduces estate taxes, but may be subject to capital gains tax. (Learn more about how the Trust works with municipalities and Suffolk County on the Purchase of Development Rights.)
Transfer of Development Rights (TDR): In this transaction, development rights are transferred from one property in a sending district to another property(ies) in a receiving district(s).
Bargain Sale: This is a sale of property or development rights to a charitable conservation organization or municipality at less than fair market value. The difference between the fair market value and the bargain sale price is a charitable donation and can be claimed as an income deduction.
Limited Development: This option is a sensitively designed, reduced-density subdivision of land that provides income to the landowner while protecting the natural resources of the land. Voluntary reduced density may provide a charitable gift that can offset capital gains tax and may expedite the municipality's approval process. At the same time, infrastructure costs of the development are reduced.
Charitable Remainder Trust (CRT): A donor makes a gift to a charitable organization through a CRT. The donor receives a charitable gift tax deduction and does not have to pay capital gains tax on the asset. The CRT manages the investment of the asset and distributes a stream of income to the donor over a specified time period.
Reserved Life Estate: A gift of a residence with a reserved life estate to a charitable organization allows the donor to continue living in the residence during their lifetime. Upon the donor's passing, the organization may sell the real estate and use the proceeds to carry out its charitable mission.
Family Limited Partnership: A form of ownership that can be used to transfer land and other assets from one generation to another. It reduces the total value of the asset, thereby reducing estate taxes.
Like-kind Exchange: A transaction where property is exchanged for other qualified like-kind property, and, as such, capital gains tax is deferred. The exchange can be fulfilled through a sale of land or development rights as long as the exchange property is identified within 45 days after the sale of the original property. Proceeds of the sale must be invested in a qualified business or investment property and the closing must take place within 180 days after the initial sale.
Tax-exempt Installment Sale: In this option, because the proceeds of the sale are spread over a number of years, the seller defers payment of the capital gains tax and, by increasing the basis, reduces inheritance taxes that are paid during the term of the installment sale.
Participation in an Agricultural District: Participation in the New York State Agricultural District Program can reduce real property taxes an average of 80% and provide protection from nuisance complaints. In this program, the landowner agrees to keep the land in agricultural production for an 8-year term.
Testamentary Gift: Gifts of land and conservation easements can be made to the Last Will and Testament. While testamentary gifts do not result in a charitable contribution for income tax purposes during the donor’s lifetime, such gifts can dramatically reduce the estate tax liability faced by the next generation. Codicils to a will can be an effective interim measure to protect land while planning is underway.
Fair Market Purchase: If funds are available, the Trust may purchase land or conservation easements at fair market value. In other instances, the Trust may negotiate a purchase on behalf of municipalities.