State Income Tax Credit
Conservation easement donors now may take a tax credit against State income taxes. The credit is in addition to the Federal income-tax deduction, estate- tax savings, and the Maryland property-tax credit. Details are as follows:
For additional information on the credit or the other benefits associated with donated conservation easements, please contact the Maryland Environmental Trust at (410) 514-7900.
- The easement must be perpetual, conveyed to the Maryland Environmental Trust (MET) or the Maryland Agricultural Land Preservation Foundation (MALPF), and approved by the Board of Public Works.
- The total credit taken cannot exceed the appraised value of the easement, reduced by any payment received for the easement.
- The maximum credit that an individual may take per year is the smaller of $5,000, or the amount of State income taxes owed for that year. An individual may take the credit for the year in which he or she conveyed the conservation easement, and continue, at a maximum of $5000 per year, for an additional 15 years, for a total of up to $80,000. A taxpayer may not claim a State income tax deduction and a State income tax credit for the same conservation easement donation.
- When multiple individuals (owners) jointly donate an easement, each one is separately entitled to the tax credit of up to $5,000 per year. For example, a husband and wife, even if filing jointly, may take up to a $10,000 credit per year. To calculate the total credit which an individual may take, multiply the appraised easement value by the individual's percentage ownership of the property.
- Easements donated before July 1, 2001 do not qualify for this credit. However, a second easement, or amendment, that materially strengthens the conservation restrictions of the original easement may create a tax credit.