Sometimes the greatest charityof all is simply doing zip, nada, and nothing. Well, at least that may be thecase when it comes to being charitable with land. Why? Because the charityconsists in preserving the land from development instead of capitalizing on itshighest and best economic use.
Enter the conservation easement.
The perennial problem witheasements, however, is the question of valuation of the â€œpotential valueâ€ ofthe land.
The entire point behind aneasement is that the land itself (or the faÃ§ade, as the case may be withurban-dwellers) has intrinsic value worth saving. This can be hard to put intoconcrete numbers. But then again, there always remains the risk that certainpersons may look to maximize the charitable deduction for an easement through creative valuation.
This theme was picked up in arecent Forbes article titled â€œConservation Easement No Deduction ForHypothetical Vineyard.â€ Thelesson is less outlandish than the title suggests â€“ not every problem comesfrom supposing the remote possibility of a vineyard, a stadium, or askyscraper. Rather, when asking for the easement you need to settle upon oneout of every possible use of the land and the IRS has to agree that potentialuse is the best and most likely use.
The IRS has a presumption againstany big dreams, you might say, and that can be difficult to overcome.
Proper valuation is a keycomponent of any purchase, gift, or act of charity. When it comes to easements,however, the subject of valuation may be more difficult to capture accurately.
Placing an effective easementmeans building a case and an effective understanding of the true potential toany land given.
For more information on this and otherestate planning subjects, contact IdahoEstate Planning and schedule aconsultation. Remember,good planning is no accident.