New Conservation Tax Benefits for Farmers and Other Landowners Who Act in 2007

Farmers (and other landowners) who donate a permanent restriction on all or part of their land can benefit from a major new tax incentive if they act in 2007. A new law passed last summer allows qualifying farmers to take a tax deduction for their gift up to 100% of their gross income per year for up to 15 years, provided the land remains available for agriculture, and the gift is made in 2007.

The new law raises the maximum tax deduction for contributions of land, or restrictions on land, from what previously was 30% of adjusted gross income in any year, with only 5 years to use up the deduction.

For farmers to take advantage of the new incentive, the donor, whether an individual or a corporation, must be a “qualified farmer or rancher.” This is defined in the tax code as a taxpayer (either an individual or corporation) whose gross income from the business of farming is greater than 50% of the taxpayer’s gross income for the taxable year in which the conservation restriction is donated.  For purposes of this incentive, farming and other kinds of agricultural activities, as well as forestry use will satisfy the requirements of the statute.

The property must also be used in agriculture or livestock production (or available for such production) and the restriction must provide that the property remain available for such production. There is no requirement as to any specific agricultural use, or that the property necessarily be used for such purposes, merely that it remain available for such purposes. That is, the restriction need not require that the property stay forever in agricultural use, but the restriction must include such agricultural activity as a “reserved right”. 

For more information, call the Vineyard Conservation Society at 508 693 9588 or email vcsinc@vineyard.net

Study Finds Overwhelming
Economic Benefits in Land Preservation

A group of scientists and economists have calculated that forests, wetlands and other natural ecosystems are worth far more to human economies than the same land developed. The study, published in the August 9 edition of Science, found that every year, conversion of wildlands via logging, farming, or development costs the world economy a whopping $250 billion. It would cost approximately $45 billion to protect threatened areas of temperate and tropical forest, mangrove swamps, coral reefs, etc., but the return over time in goods and services would amount to at least $4.4 trillion -a nearly 100-1 benefit-cost ratio.

"The economics are absolutely stark. We thought the numbers would favor conservation, but not by that much," said co-author Andrew Balmford of Cambridge University. David Constanza of the University of Vermont added: "We've been cooking the books for a long time by leaving out the worth of nature. Economics has traditionally focused on the market. But we have been finding that a lot of what is valuable to humans takes place outside of the market."

www.guardian.co.uk/worldsummit2002/story/0,12264,771528,00.html

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