New York State Tax Credit (cont.)

Unlike a tax deduction, which is an adjustment to taxable income, a tax credit offsets a taxpayer’s tax liability on a dollar-for-dollar basis.  Further, the CETC is a refundable income tax credit, which means that if a landowner’s tax credit exceeds the amount he or she owed in state income taxes, the landowner gets a check for the difference!  Landowners can claim this rebate when they file their New York State Income tax return.

Who is eligible for the CETC?

The CETC is available to individual landowners and also to estates and trusts (including beneficiaries of an estate or trust), partners in a partnership and certain corporations.  

 What conservation easements qualify?

New York State requires that a landowner’s easement meet certain requirements in order to qualify for the CETC.

•  It must be a perpetual and permanent conservation easement as defined in Article 49 of New York’s Environmental Conservation Law.

• The land subject to the easement must be in New York State.

• The easement must be held by a public (e.g., local municipality) or private conservation agency (e.g., North Shore Land Alliance).

• The easement must serve to protect one of the following: open space, biodiversity or scenic, natural, agricultural, watershed, or historic preservation resources.

• The easement must be filed with the NYS Department of Environmental Conservation (DEC)

• Easement must comply with Section 170(h) of the Internal Revenue Code. 

The CETC applies to all conservation easements, regardless of when they were created, provided they meet the criteria listed above.  Entitlement to the CETC runs with the land, not the landowner, so subsequent land owners would be able to apply for the credit provided he or she meets the eligibility criteria.  The CETC does not apply to non-conservation easements (e.g., access easement) or those created for obtaining subdivision or other governmental approval.

Need More Information?

Please contact Beth Baldwin at the North Shore Land Alliance (tel.: 516-626-0908 or email: bbaldwin@northshorelandalliance.org)

IMPORTANT NOTE:

The information about the New York State Conservation Tax Credit contained in this document is furnished as a tool to assist qualified landowners.  It is provided with the understanding that the North Shore Land Alliance is not engaged in rendering legal, accounting, tax or other counsel.  If legal advice or other expert assistance is required, the services of a competent professional should be sought.  This document is not a substitute for legal, accounting, or tax advice and should not be relied on as such.