The Charitable Land Donation Credit allows owners of real property with conservation value to preserve New Mexico’s landscape and earn a valuable tax credit in the process.
NMSA Sections 7-2-18.10 (2007) and 7-2A-8.9 (2007) provide a state income tax credit for charitable contributions of real property in New Mexico. The contributions can include: (1) fee donations, whether from bargain sales or outright donations, and (2) conservation easements. With respect to conservation easements, such a donation takes form as an agreement between a landowner and an eligible conservation organization or public entity. The agreement restricts certain future activities on the land and allows the landowner to maintain the private ownership of the property while permanently prohibiting certain types of development. The restrictions can vary among easements, but all serve to protect the conservation values of land. An in-state or out-of-state landowner of New Mexico property can obtain this tax credit, which is measured by a qualified appraisal and equals fifty percent of the fair market value of the land or interest in land that is conveyed, up to $250,000 per year, for any of the following purposes:
- Open space
- Natural resource or biodiversity conservation
- Agricultural preservation
- Historic preservation
This credit can therefore benefit ranchers, developers, owners of property with historic attributes, and others who hold land that has conservation value. For donations occurring on or after January 1, 2008, the maximum credit is $250,000, and the carryforward period is twenty (20) years. Credits may be transferred in increments of $10,000 or more. Please view our Comparison Chart here for an overview.
Aside from the benefits associated with the Charitable Land Donation Credit, by protecting the conservation values of a property through a donation or sale of the future development rights to a private land trust or government entity, a landowner may also (1) qualify for a federal income tax charitable deduction, (2) reduce property taxation, and (3) dramatically reduce the market value of the acreage used to compute estate taxes.