Colorado’s Tax Credit Program
Colorado has
enacted one of the nation's most generous
tax incentives for donations of conservation easements. Colorado's Tax
Credit Transfer Program is designed to encourage land conservation by helping
donors take advantage of these tax benefits. Colorado conservation
tax credits are available to donors of "qualified"
conservation easements. In 2007, Colorado
taxpayers who donate a qualified easement may claim a state tax
credit worth 50% of the value of the easement donation, up to a
maximum credit of $375,000.
The State of Colorado allows
these credits to be carried forward for 20 years, during which time they
may be used to offset the donor's state income tax liability, or
transferred to other Colorado
taxpayers. Many
tax credit brokers around the
state help landowners sell the credits that they cannot personally use to
other taxpayers seeking to reduce their state income tax liability. As
more landowners take advantage of this program, all of Colorado
benefits from the preservation of more open space for future
generations to enjoy.
How It All Works
The donor of a conservation easement receives a tax credit
from the state based on the value of their easement as determined by a qualified
appraisal. Brokers will then match easement donors with credit buyers on a
first-come, first-served basis. Credit buyers purchase the credits at
a discounted rate, and the donor then receives approximately 80-85%
of their credit value in cash. Transaction costs are included in the
discount.
Highlights
• Colorado taxpayers are
eligible for income tax credits for the donation of a qualified conservation
easement.
• The maximum tax credit allowed in 2007 is $375,000 (achieved
through an easement donation valued at $750,000 or more). This credit is
worth 50% of the easement donation value.
• Conservation tax credits are transferable to other Colorado
taxpayers, and may be sold for cash.
• Tax credit brokers will broker the sale of tax credits from its easement
donors to interested buyers at a discount.
For additional
information on how you can work together with OLT
to protect and conserve land in the northern San Luis Valley:
For more information contact Neil Seitz by
e-mail or call 719-256-5212
Orient Land Trust