What is a Historic Conservation Easement?
An historic conservation easement is a legal tool used to preserve the integrity of a historic building, site, object, or landscape. The legal structure of the easement allows the owner to retain rights of ownership, while giving Heritage Ohio the responsibility to prevent present and future owners from making changes to the historic resource that could compromise its historic integrity. A legal agreement is filed in the county where the property is located, and the easement becomes part of the deed record, binding in perpetuity.
Benefits of Historic Conservation Easement
- The ability to treat the value of the easement donation as a charitable contribution, and a possible tax deduction.
- Typically, a decrease in real estate tax liability
- Permanent protection of a historic resource from inappropriate changes or alterations
- Written and photographic documentation of the property, archived at Heritage Ohio.
What Properties Are Eligible?
While a wide variety of property types could have an easement donated, to be eligible for favorable IRS tax treatment, a property is typically listed in the National Register of Historic Places, either as a single resource, or as a contributing resource in a historic district. An easement can be donated before, during, or after rehabilitation of a historic building; however, the timing of an easement donation may have substantial tax consequences and should be reviewed by an accountant or tax lawyer with knowledge in easement procedures.
How Much is Tax Deduction Worth?
The value of the historic conservation easement, the deductible amount, is determined by a specialized appraisal performed on your property. This value may increase or decrease depending upon factors such as the level of restrictions, whether the interior of the building is included in the easement, and whether future development potential is voluntarily relinquished as a result of the easement. Exterior or interior easements can allow change of use and building alterations as long as they are in accordance with the Secretary of the Interior’s Standards for Rehabilitation, and allowed by Heritage Ohio.
