How does one determine the value of an easement for purposes of calculating the deduction?
The value of a preservation easement for purposes of the federal tax deduction must be determined through a qualified appraisal, performed by a qualified appraiser. [Note: the 2006 reform legislation in this area sets new criteria for qualified appraisals and qualified appraisers. See our summary here. If there is a substantial record of sales of easements comparable to the donated easements (such as purchases pursuant to a governmental program), the fair market value of the donated easement is based on the sales prices of such comparable easements. If – as is more typical – no substantial record of market-based sales is available to use as a meaningful or valid comparison, the fair market value of a perpetual preservation easement is equal to the difference between the fair market value of the property before the granting of the easement and the fair market value of the property after the granting of the easement. This “before-and-after” methodology measures the loss of market value r
Related Questions
- Who will determine the timing of appraisals for purposes of calculating "appraisal reduction amounts" for newly issued CMBS collateral?
- Who gets the appraisal to determine the conservation easements value for tax purposes and how is the value determined?
- Id like to donate a painting. Will TCNJ determine its value for my income tax deduction?
