You may qualify to claim this credit if:
You give, or “convey,” land, or the right to use land (an “easement”) to a public or private nonprofit group for one of the approved uses below. The gift must be permanent. The land can never be developed for another use. The approved land uses are:
- Historical or conservation preservation
- Agricultural use
- Forest use
- Open space
- Natural resource conservation
Nonprofit groups that you give the land or easement to must be classified as 501(c)3 nonprofits by the IRS.
What is it?
An income tax credit equal to 40% of the fair market value of the land at the time of the donation, as determined by a qualified appraiser.
Is there a cap?
Yes. Virginia Tax can issue no more than $75 million in land preservation tax credits each year. We issue these on a first come, first served basis. Each taxpayer can claim up to $20,000 in land preservation tax credits per year. For individual limits for earlier years, please see Schedule CR Instructions.
To apply for the credit:
We can only issue $75 million in land preservation tax credits each year. To receive credits, you must apply by December 31 of the year following the year when your donation was recorded. Credits are issued on a first come, first served basis. We can’t guarantee that an application postmarked after November 1 will be processed by the end of the year (we’ll try, but can’t promise), so apply early.
All applications must include:
- Form LPC-1, its schedules and attachments
- A copy of the recorded deed of donation
- A copy of the completed and signed IRS Form 8283
- A copy or CD of the full appraisal
- A signed statement or notarized affidavit from the appraiser
Requests over $1 Million: All credit requests of $1 million or more must be submitted to us and the Department of Conservation and Recreation (DCR). We can’t issue credits for more than $1 million until DCR verifies them. Visit the DCR website for more information.
Using this credit
Claim the land preservation tax credits by completing Schedule CR and attaching it to your Virginia income tax return. If you were the one who originally gave the land or granted the easement, the "donor," you may carry forward any unused credits for up to 10 years, for most taxpayers. If you received the credit from someone else, the carry forward period is up to 11 years from the date that the credit was originally issued.
Leaving your credits to a designated beneficiary
Beginning July 1, 2018, you can leave your unused credits to someone you name in your will, bequest, or other document to receive them. This change only applies to transfers brought about by deaths happening on or after July 1, 2018, regardless of when the donor earned the credits. If the donor dies without a will, any unused credits will transfer to the next person who is eligible to receive them according to Virginia law.
These credits are also transferrable. See Transferring a Land Preservation Tax Credit for more information.