NYS Conservation Easement Tax Credit (Conservation Easement Credit)

The Conservation Easement Credit is a refundable New York State income tax credit for landowners whose land is under a permanent conservation easement. It is worth 25% of the school district, county and town property taxes paid on the eased land, up to $5,000 each tax year. If the credit is more than the income tax owed, the landowner receives the difference as a refund. DEC registers eligible easements, and the credit is claimed through the NYS Department of Taxation and Finance. Farm and forest owners who donated an easement, or sold one for less than market value, to a land trust or public agency can qualify.

• Individuals, estates and trusts (including beneficiaries), partners in a partnership (including LLCs taxed as partnerships), and business corporations taxed under Article 9-A of the Tax Law.

• Not available to Subchapter S corporations or their shareholders, not-for-profit corporations, or other kinds of corporations.

• The land must be in New York State and under a permanent conservation easement as defined in Article 49 of the Environmental Conservation Law.

• The easement must be held by a public conservation agency (including soil and water conservation districts, villages, towns and counties) or a private conservation agency such as a not-for-profit land trust.

• The easement must be registered with DEC and have a DEC CE identification number.

• The easement must have been donated or partially donated (sold for less than fair market value). Easements purchased at market value are not eligible.

• Not eligible: rights-of-way, scenic easements, easements created to get subdivision or building permits, and mitigation easements.

• Landowners who live outside New York must file a nonresident income tax return each year to receive the credit.

• Refundable credit of 25% of the school district, county and town real property taxes paid during the tax year on the eased land. Taxes on buildings, structures and other improvements don't count.

• Up to $5,000 each tax year.

• If the credit is more than the income tax owed, the landowner receives a payment for the difference.

• This credit plus any other credit based on the same property taxes can't exceed the taxes paid.

Claim the credit each year on your New York State tax return: Form IT-242 for individuals and other filers, or Form CT-242 for corporations.

To file, gather a copy of the filed easement, the survey and tax maps, the date the easement was filed with the County Clerk, the recording information, the name of the agency holding the easement, its DEC CE identification number, and the county, town and school taxes paid on the eased land.