Donating Land to VOF

Although the majority of VOF’s conserved lands are the result of donated easements, some landowners have opted to give entire properties to VOF. Their reasons vary. Some don’t have heirs and would like to see the property protected. Others are trying to reduce estate tax burdens. And sometimes donors simply feel the land is so special and has so much public value that it would be safest in public hands. Whatever the reason, land donations are one of the most generous legacies that landowners can leave to future generations. Below are some ways landowners can donate an entire property to VOF. If you are considering any of these options to protect your land, please talk to your attorney, tax advisor, and VOF before making any decisions. You may contact VOF’s Leslie Grayson at (540) 347-7727 or lgrayson@vofonline.org.

When VOF evaluates a potential land donation, it first examines the property’s value as public land. Does it provide opportunities for public recreation? Does it protect important water resources or endangered species? The higher the public benefit, the more likely VOF will accept ownership of the land. If the property doesn’t meet the criteria for public land but has high conservation value, VOF may place a conservation easement on the property and sell it to another entity or private landowner. If the property has little conservation value but high market value (for instance, if it’s a small urban lot with a building on it), VOF may—with the donor’s permission—sell the property and use the proceeds to protect other land with higher conservation value.

Some people wish to donate property to VOF after their death. If they are not concerned about getting a tax deduction on their income taxes, they can leave the property to VOF through a will. This will benefit heirs by reducing estate taxes. It’s important for donors to notify VOF if they plan to include such a gift in a will, to be sure that VOF will be able to receive it.

What about donors who want to continue living on and using a property and donate it to VOF after their death, but wish to receive the tax benefits now? That’s when they could consider donating a remainder interest. They could continue to enjoy the land during their lifetimes and may be eligible for an income tax deduction when the gift is made. The value of the deduction is based on the fair market value of the donated property less the expected value of the life estate.

For those who want to donate land to VOF but receive income during their lifetime, one option is a charitable remainder trust. A donor starts by putting the land under easement and placing it in a trust. Then, the trustee sells the land and invests the net proceeds. One or more beneficiaries will receive payments each year for a fixed term or for life; then, the trustee turns the remaining funds in the trust over to VOF.