A variety of options exist for preserving land.  For a more in-depth analysis of these options, the differences between them, and an explanation of the different groups on Nantucket which focus on these different conservation methods, read on below:

Conservation Restrictions: This is the Nantucket Land Council’s main conservation method and area of expertise.

Preserving open land owned by individuals via permanent conservation restrictions is a compelling technique because it benefits both the Nantucket community and the land owner.  With a conservation restriction, the landowner can permanently protect their land without giving up ownership. The landowner can continue to live on it and use it, and can sell or pass it on to heirs. With the successful completion of the Loring Campaign to protect 270 acres, the NLC now holds 70 permanent conservation restrictions which protect more than 1,050 acres. To read more about our past campaigns go to our Success Stories Page or our Land Preservation Map.

When a conservation-minded landowner gives up future development activities on his/her private land by granting a conservation restriction, a variety of benefits, both public and private are derived. The landowner receives tax benefits and the knowledge that their land will be passed on to heirs or sold to others without risking future loss of open space. For the public, conservation values, such as scenic views, drinking water supply, plant and wildlife habitat, are protected.

In addition, preserved open space saves the taxpayers' money because it will never require costly town services, such as schools, police, landfill space, sewers, fire trucks, and road repairs, which are driven by development.

To be permanent, these legal agreements must be approved by both the town (either the Board of Selectmen or Town Meeting) and by the Commonwealth of Massachusetts, and they must be recorded in the Registry of Deeds.

By contributing a conservation restriction, a landowner gains peace of mind knowing that one's treasured land always will be kept in its natural condition and she or he derives tax benefits, which reduce one's estate. When the restricted land changes hands - whether sold, given as a gift, or bequeathed - it still is preserved by the conservation restriction, which the NLC agrees to permanently enforce.

To guarantee the terms of these agreements, the NLC inspects the properties on an annual basis. Careful monitoring and direct communication with owners, and especially new owners, go a long way to preventing violations. Nevertheless, a dedicated enforcement endowment which is funded solely by conservation restriction contributors has been established to pay for potential future costs, including legal defense of the restrictions themselves, should that become necessary.

Currently, the tax incentives for donating Conservation Restrictions are less generous, than what was passed in the previous Farm Bill, but they remain high at up to 30% of your adjusted gross income, deductible over a period of 5 years.

Gifts of Land: The Nantucket Conservation Foundation is particularly well-equipped to act as the steward of open spaces. Therefore, gifts of land, rather than of Conservation Restrictions, tend to go to the NCF.

Outright Donation (Fee Simple Transfer)

Giving the land to a non-profit conservation organization or to a government agency is the simplest way to protect land. It is only necessary to obtain acceptance from the agency or organization to which the land will be donated, prior to deeding the land. A gift insures long-term protection of the land. The donor receives tax benefits in the form of federal income tax deductions, potential estate tax benefits, and relief from property taxes. The donor is relieved of management responsibilities, and automatically absolved of liability associated with any trail use.

Typically, the only cost to the land donor is for an appraisal, which certifies the value of the donated land for federal income tax deductions. Appraisals are needed when the claimed value of the deduction is more than $5,000. Land trusts usually ask donors to pay remaining property taxes on the land before it becomes tax exempt in the next fiscal year.

Donation by Will (Bequest)

A gift of land made through a will entitles the donor to retain full use of the land during his or her lifetime and assures that it will be cared for in the future. It is advisable to discuss the gift with the agency or organization prior to inclusion in a will, to insure a plan for the care of the land. The donor is responsible for real estate and income taxes for the property during his or her lifetime. But removing the land from an estate will reduce inheritance taxes. This may be particularly helpful for family estates with more than one property, where inheritance taxes will be high. One property can be donated, thus reducing inheritance taxes and permitting the family to retain ownership of the other properties, rather than being forced to sell their land for development.

Donation with a Reserved Life Estate
A donation with a reserved life estate may be made to a government agency or conservation organization. The donor retains the use of the land during his or her lifetime, and the lifetimes of specified family members. A reserved life estate insures that the land is protected in perpetuity, yet allows the donor to reside on it and maintain the land. The tax advantages with a retained life estate are less that those with an outright donation.

Gifts of Other Properties
Many conservation organizations and agencies will accept a gift of property with little or no environmental value, sell it on the open market (with restrictions, if appropriate), and use the money for the preservation of other ecologically significant lands. The landowner is eligible for the same tax benefits as a gift of conservation land.

Sale of Land: The Nantucket Islands Land Bank is the main group on Nantucket that focuses on the purchase of land. Land Bank revenue is derived from a 2 percent real estate transfer fee which is levied against most real estate transfers on the island.

Sale at Fair Market Value
Sale at fair market value is the sale of property at the price a knowledgeable buyer would pay for the land. Most conservation organizations are not able to purchase land at full value owing to the high cost of land and insufficient funds. However, Nantucket is fortunate to have created the Nantucket Islands Land Bank in 1983, allowing the creation of an organization equipped to compete in the open market to acquire land for public benefit. During calendar year 2005 the Land Bank processed 1,282 property transfers and collected over $23,015,984 in transfer income. There are no charitable deductions associated with a sale at full value.

Bargain or Charitable Sale
A bargain sale is part donation and part sale to a government agency or non-profit organization. A bargain sale may entitle the seller to an income tax deduction for a charitable contribution and to a reduction in capital gains tax. The value of the income tax charitable contribution for the seller equals the difference between the fair market value and the lower negotiated selling price for charity. The net cash to the seller at the bargain price may approximate the fair market sale when the tax deduction is taken into account.

Capital gains must be calculated on the sale part of the transaction. A gain is recognized if the property is sold for more than its basis (the basis is usually equal to the original cost, plus improvements and minus depreciation). For bargain sales, the basis of the property must be allocated proportionately between the part sold and the part donated. The income tax charitable deduction from a bargain sale could be greater that the capital gains tax liability that results from the sale at fair market value.

The Land Trust Alliance, the national group of which the NLC is a member, has produced a pithy brochure outlining the various options for a land owner wishing to conserve their property.  Click on the image to the left to view their brochure.