Conservation Easement Deduction Calculator

Conservation easements provide charitable deductions for donated development rights.

Pre-easement value

Post-easement value

AGI

Marginal tax rate %

Tax savings

$222,000

Deduction

$3,000,000

Carryforward

$2,400,000

How the math works

Deduction = pre − post value. Year 1 limit = 50% of AGI.

$5M − $2M = $3M deduction. Limit $600k. Year 1 savings = $600k × 37% = $222k. Carryforward $2.4M.

How to Use

Enter pre-easement value.
Enter post-easement value.
Enter AGI.
Enter marginal tax rate %.
Read deduction and tax savings.

Frequently Asked Questions

Conservation easement mechanics?

Owner donates development rights to qualified conservation organization (land trust, government). Restriction runs with the land in perpetuity. Deduction equals pre-easement value minus post-easement value (restricted).

Deduction limits?

Up to 50% of AGI each year for conservation easements on real estate. 100% of AGI for farmers/ranchers. 15-year carryforward of excess. IRS scrutiny intense on valuation — use qualified appraisers.

Valuation risk?

Pre-easement value based on highest and best use (often subdivision potential). Post-easement value is restricted use. IRS challenges inflated valuations — penalties up to 40% for substantial overstatement. Document carefully.

How often should I rerun this?

Rerun this calculator whenever inputs change materially — new rent roll data, rate moves, loan balance updates, or quarterly operating data. For active deals, monthly refresh is typical. For stabilized assets under monitoring, quarterly is fine. Treat the output as a decision tool, not a one-time answer — market conditions evolve and so should your analysis.