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Conservation Easement Tax Credits in Virginia

Did you know Virginia landowners can receive a state tax credit worth 40% of their conservation easement donation? That’s a powerful financial incentive to preserve your property—up to $20,000 per year, carry forward for up to 10 years, and even transferable.

💡 What Are Conservation Easement Tax Credits?

Under Virginia’s Land Preservation Tax Credit program, you receive a state income tax credit equal to 40% of the appraised value of a qualifying easement or land donation :contentReference[oaicite:1]{index=1}.

You can use up to $20,000 per person per year, with any unused credit carried forward for up to 10 years :contentReference[oaicite:2]{index=2}.

👥 Transferring or Selling Tax Credits

Can’t use all your credits? You may sell or transfer the unused portion to another Virginia taxpayer—commonly at 70–90¢ on the dollar :contentReference[oaicite:3]{index=3}.

📈 Federal & Estate Tax Benefits

You may qualify for a federal charitable deduction as well—typically up to 50% of AGI (or 100% for farmers), with a 15-year carry-forward :contentReference[oaicite:4]{index=4}. Easements also lower estate value, potentially reducing estate taxes under IRC § 2031(c) :contentReference[oaicite:5]{index=5}.

⚖️ 2025 Update: Increased Annual Cap

Starting in 2025, Virginia’s annual cap on tax credits increases from $75 million to $100 million, adjusted annually for inflation :contentReference[oaicite:6]{index=6}.

📋 How to Qualify

  • Work with a qualified land trust or conservation agency (501(c)(3) or public entity)
  • Get a qualified appraisal showing before/after value reduction :contentReference[oaicite:7]{index=7}
  • File forms LPC‑1 for credit and LPC‑2 for transfers
  • Apply by December 31 of the second year after donation year :contentReference[oaicite:8]{index=8}

How Doummar Law Can Help

We assist landowners by:

  • Structuring easements to maximize credit value
  • Coordinating appraisals and filing LPC‑1/LPC‑2
  • Advising on credit transfers and federal deductions
  • Ensuring compliance with DCR and Dept. of Taxation deadlines

📞 Call (757) 422‑0061 or book a consultation to maximize your tax and conservation strategy.

📢 Get Your Conservation Easement Right

Protect your property and get financial benefits—the right way. Let Doummar Law guide your easement process.

Schedule a Consultation

Frequently Asked Questions

How much credit can I claim each year?

You can claim up to $20,000 per individual taxpayer annually, with any unused portion carried over for up to 10 years :contentReference[oaicite:9]{index=9}.

Can I sell unused tax credits?

Yes. Virginia allows transferring or selling credits—commonly at 70–90¢ per dollar on the open market :contentReference[oaicite:10]{index=10}.

What documents do I need?

You’ll need a qualified appraisal, recorded deeds, LPC‑1 form for credits, and LPC‑2 for transfers :contentReference[oaicite:11]{index=11}.

Are there tax benefits beyond Virginia?

Yes—most donors receive a federal deduction (typically a percentage of AGI), and your estate may benefit from reduced estate tax exposure :contentReference[oaicite:12]{index=12}.

Did the credit cap change in 2025?

Yes—the statewide cap increased from $75 M to $100 M annually, adjusted for inflation from 2025 onward :contentReference[oaicite:13]{index=13}.