The Next Century Conservation Plan sets the stage to make the Forest Preserves of Cook County a national leader in urban conservation. One of the plan’s recommendations is to expand the Forest Preserves from 70,000 acres to 90,000 acres. Why do we want to grow? Because by protecting land, we contribute to cleaner air and water, help prevent flooding, create trail connections, increase property values, and improve the quality of life for all who call this region home. We need to protect prairie, wetland and woodland habitat for native plants and animals, so they can live and thrive. The survival of many species depends on the actions we take now.
In order to achieve this important Next Century Conservation Plan goal, the Forest Preserves has established a menu of options designed specifically for landowners who may be considering a land conservation gift or donating property that can be sold with proceeds going towards the Forest Preserves’ acquisition fund:
Find out what options may be available for your property by contacting Chris Adas, Real Estate Agent, at 312-603-0027 or Christopher.Adas@cookcountyil.gov.
Sale of Land
Selling your property to the Forest Preserves of Cook County has its advantages. You might wish for the land to be enjoyed by the public, or you might find that the Forest Preserves is better able to manage it, or taxes may have risen too high for you to continue to own or protect it. The Forest Preserves has funds to purchase property with natural, scenic or recreational qualities. In considering a sale, you have the following options:
Sale (Fee Simple) — For this option, the selling price would be determined through negotiation with the Forest Preserves. If your land has appreciated since you originally purchased it you may be liable for income tax on the capital gain. This may significantly affect your net profit from the sale.
Bargain Sale — In a bargain sale, you would sell your land to the Forest Preserves at less than full market value, which would be determined by an independent appraiser. The difference between the selling price and the fair market appraised value is considered a donation. You are then eligible for a charitable income tax deduction equal to the difference between the full price and the bargain price.
Installment Sale — You can also sell a portion of your land with an option to sell the remainder in successive years thereafter. You would spread the income from the sale over several years, thereby helping to reduce your capital gains tax. If you use installments combined with a bargain sale you may be able to increase the amount of income tax deduction.
Sale with a Reserved Life Estate — You may sell your land to the Forest Preserves and retain the right of lifetime tenancy for you and/or your immediate family. Any income tax savings would depend on whether the sale is at fair market value, at bargain sale, or in installments.
Find out what options may be available for your land by contacting Chris Adas at 312-603-0027 or Christopher.Adas@cookcountyil.gov.
Donation of Land or Property
Donating your land to the Forest Preserves of Cook County is the simplest way to protect it in perpetuity—even if you continue to live on the site. Not only do you provide long-term protection to the land, you may also receive income, property and estate tax benefits.
Outright Donation of Land — In an outright donation, you donate full ownership of the land while you are still living. This offers maximum tax advantages because you may take a charitable gift deduction based on the full fair market value of your land as determined by an independent appraiser. This charitable gift deduction can significantly reduce your income taxes. You would no longer pay property taxes on the donated land, and estate taxes (if applicable) for this land would be eliminated.
You can donate your land, but not give it up immediately. In this case, two options are available:
Donation by Will — By leaving your land to the Forest Preserves in your will, you retain full use and control over your land while you are alive, and ensure its protection after you are gone. You do not receive an income tax deduction or property tax relief. However, your estate taxes (if applicable) are eliminated.
Donation with Reserved Life Estate — With this option, you donate your land to the Forest Preserves and retain use of all or part of the land during your lifetime, or even the lifetime of immediate family members. The value of your donation for tax purposes is based on the fair market value of the property, less the estimated value of your life interest in the property, according to IRS guidelines. The tax advantages are less than with an outright donation, but greater than with a donation by will.
Real Estate Donations — The Forest Preserves is grateful to accept real estate donations of any kind (house, condominium, commercial property, etc.). Property gifts like this can provide you with a significant charitable gift deduction, while allowing the Forest Preserves to sell the property with all proceeds going to its land acquisition fund.
Find out what options may be available for your land or real estate property by contacting Chris Adas at 312-603-0027 or Christopher.Adas@cookcountyil.gov.
Conservation Easement
A conservation easement is a legal agreement between a landowner and a conservation organization that permanently limits certain uses of a property in order to protect its conservation values. Easements allow you to continue to own and use your land, and to sell it or pass it on to heirs. Easements can qualify as tax-deductible charitable donations, and significant income, estate and property tax benefits are common.
When you create a conservation easement, you choose to give up some—but not all—ownership rights. For instance, an easement on property with rare wildlife habitat might forbid any development outside of trails and boardwalks, but one on a farm might allow crops and construction of an additional barn or even a home site. All future owners are bound by an easement’s terms. An easement may apply to just a portion of your property, and may require public access.
Perhaps most importantly, conservation easements on highly valuable land can be essential for passing land on to heirs. By removing the land’s development potential, the market value is lowered, significantly lowering the estate tax—which can be as high as 35% of the land’s value. In many cases, a second sizable deduction can be applied as well. These savings can make the critical difference in your heirs’ ability to keep the land.
Find out what options may be available for your land by contacting Chris Adas at 312-603-0027 or Christopher.Adas@cookcountyil.gov.
More about conservation easements: