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Current News
CT Contemplating Tax Credit for Land Conservation and Gifting
General Assembly
Raised Bill No. 5137
February Session, 2008
LCO No. 1490
*01490_______ENV*
Referred to Committee on Environment
Introduced by:
(ENV)
AN ACT CREATING A CONSERVATION TAX CREDIT FOR INDIVIDUALS.
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. (NEW) (Effective July 1, 2008, and applicable to income years commencing on or after January 1, 2009) (a) For the purposes of this section, "donation of open space land" means the conveyance of any land or interest in land identified in a municipal, state or regional map as a priority for conservation, without financial consideration or any discount of the sale price in any sale of land or interest in land, to the state, a political subdivision of the state, a water company, as defined in section 25-32a of the general statutes, or to any nonprofit land conservation organization where such land is to be permanently preserved as (1) protected open space, (2) a public water supply source, (3) a natural resource or for biodiversity conservation, or (4) agricultural land, excluding the donation of a golf course or athletic field or other land mandated by local subdivision requirements to be conserved; and "taxpayer" means any individual, estate, trust, beneficiary of an estate or trust or partners in a partnership, including a limited liability corporation, that is considered a partnership for federal income tax purposes.
(b) Subject to the provisions of subsection (d) of this section, there shall be allowed a credit for taxpayers against any tax due under the provisions of chapter 229 of the general statutes, in an amount equal to fifty per cent of the value of any donation of open space land. For purposes of calculating the credit under this section, the amount of donation shall be based on the use value of the donated open space land and the amount received for such land. For purposes of this subsection, "use value" means the fair market value of land at its highest and best use, as determined by a real estate appraiser certified or licensed pursuant to chapter 400g of the general statutes. The amount of the credit shall not exceed three hundred thousand dollars. In no case shall a credit exceed such taxpayer's liability under chapter 229 of the general statutes for such year.
(c) In order for any taxpayer to qualify for the credit provided for in subsection (b) of this section, the taxpayer shall submit the following in a form prescribed by the Commissioner of Revenue Services at the same time as the taxpayer files a return for the taxable year in which the credit is claimed:
(1) A statement indicating whether a deduction was claimed on the taxpayer's federal income tax return for a conservation easement;
(2) A summary of the conservation purposes, as specified in subsection (a) of section 1 of this act, that are protected by the easement, the county and municipality where the easement is located, the number of acres subject to the easement, the amount of the tax credit claimed, and the name of the organization holding the easement; and
(3) A sworn affidavit from the appraiser that includes:
(A) A statement specifying the value of the unencumbered property and the total value of the conservation easement;
(B) If the appraisal separately allocates the values of sand and gravel, minerals, water or improvements, a statement of the separate value of the sand and gravel, minerals, water or improvements before and after the conservation easement is granted; and
(C) A sworn affidavit from the holder of the conservation easement that includes the following:
(i) A copy of the information filed by the holder with the Department of Revenue Services and either the Department of Agriculture or Environmental Protection, as applicable, in accordance with section 2 of this act, and a copy of the applicable department's approval;
(ii) A statement of whether the transaction is part of a series of transactions by the same donor; and
(iii) A statement that the holder has reviewed the form of the taxpayer claiming the conservation easement credit and that the property is accurately described in said form.
(d) A credit or any portion of a credit that is allowed under this section, with respect to any taxable year commencing on or after January 1, 2009, but is not used by a taxpayer because the amount of the credit exceeds the taxpayer's liability, may be carried forward to each successive income year until such credit is fully taken. In no case shall a credit or any portion of a credit that is not used be carried forward for a period of more than fifteen years.
(e) The total amount of such credits allowed under this section shall not exceed ten million dollars in the aggregate in any fiscal year. For the purposes of calculating the total amount of credits, "fiscal year" means the year that the qualifying donation of open space land occurred, regardless of the carry forward period.
(f) Any credit allowed pursuant to this section may be sold, assigned or otherwise transferred to one or more taxpayers. If a taxpayer sells, assigns or otherwise transfers such credit to another taxpayer, the transferor and transferee shall jointly submit written notification of such transfer to the Commissioner of Revenue Services not later than thirty days after such transfer. The notification shall include any information required by said commissioner. Failure to comply with this subsection shall result in a disallowance of such credit until there is full compliance by the transferor and transferee.
Sec. 2. (NEW) (Effective July 1, 2008, and applicable to income years commencing on or after January 1, 2009) (a) Any entity that accepts a donation of a conservation easement for which a credit is claimed against any tax due under chapter 229 of the general statutes, in accordance with the provisions of section 1 of this act, shall submit the following information to the Department of Revenue Services, and for a donation of agricultural land, as defined in section 22-3 of the general statutes, to the Department of Agriculture, and for a donation of any other type of land, to the Department of Environmental Protection:
(1) The number of conservation easements held by the entity in the state;
(2) The number of acres subject to each conservation easement held in the state;
(3) The names of the board members if the entity is a private nonprofit organization or the names of the elected or appointed officials if the entity is a public organization; and
(4) A signed statement from the entity acknowledging that the entity: (A) Has a commitment to protect the conservation purpose of the donation and has the resources to enforce the restrictions; and (B) has adequate resources and policies in place to provide annual monitoring of each conservation easement held by the entity.
(b) On and after January 1, 2009, no entity may accept any donation of a conservation easement for which a credit is claimed unless the entity has submitted the information required by subsection (a) of this section with the Department of Revenue Services and either the Department of Agriculture or the Department of Environmental Protection, as applicable. Such information shall be submitted no later than April fifteenth of the calendar year in which the entity wishes to accept such donation of a conservation easement.
(c) The Department of Agriculture or Environmental Protection shall not approve such donation unless: (1) The appraisal of the donated land meets federal standards; (2) the donation is a donation of open space land, as defined in section 1 of this act; and (3) the entity accepting the donation is qualified to receive land or interest in land for conservation purposes, as specified in this section and section 1 of this act.
This act shall take effect as follows and shall amend the following sections:
Section 1
July 1, 2008, and applicable to income years commencing on or after January 1, 2009
New section
Sec. 2
July 1, 2008, and applicable to income years commencing on or after January 1, 2009
New section
Statement of Purpose:
To create a conservation tax credit for individuals who donate open space land.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]
Sincerely,
State Representative Roberta B. Willis
House Chairman, Higher Education and Employment Advancement Committee
Connecticut General Assembly
860-240-0280
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