Easement ResourcesUpdated 10/14/2011
Basic Information About Preservation Easements
Owners of historic properties devote considerable time, effort, and expense to restoring and maintaining the architectural details and historic character of their properties. Preservation-minded owners often worry that their properties will not be properly protected and maintained in the future by subsequent owners. Likewise, preservation organizations have a strong interest in ensuring the long term protection of the many thousands of historic properties that remain in active private use, whether a nationally-significant landmark, a rural village, a cultural landscape, or farmland.
For property owners looking to permanently protect their historic properties, one of the most effective legal tools available is the preservation easement – a private legal interest conveyed by a property owner to a preservation organization or to a government entity. The decision to donate a preservation easement is almost always voluntary, but, once made, it binds both the current owner and future owners to protect the historic character of the property subject to the easement. Preservation easements have been used to protect a wide range of historic properties across the country – from New England Cape Cod cottages to Southwestern archaeological sites, and from Kentucky horse farms to mid-twentieth century Modernist houses in California. While some easements are for a period of years, in most instances easements are created as permanent restrictions.
Preservation easements have become an important component of state and federal policy to encourage public participation in the preservation of America’s historic resources. Indeed, their use is specifically encouraged by an important economic incentive: property owners who donate qualified preservation easements to qualified easement-holding organizations may be eligible for a charitable contribution deduction from their federal income taxes for the value of the historic preservation easement – provided that the contribution meets the standards of the Internal Revenue Service (IRS).
Frequently Asked Questions About Preservation Easements
For more information on a given topic please select from one of the following links:
- In the past, I’ve seen easement promotions from the "National Architectural Trust?" Is that organization related to the National Trust for Historic Preservation?
- I’ve seen statements to the effect that IRS guidelines provide that façade easements are worth 10-15 percent of the value of a particular property . . . is this true?
- I’ve heard that easements are starting to come under greater scrutiny by the IRS . . . should I be concerned?
- My property is already protected against changes by future owners through a local preservation law . . . wouldn’t an easement be redundant?
- Are fees charged by easement-holding organizations? What is a stewardship fee? Are there other costs to the donor?
Additional Easement Resources
- Internal Revenue Code of 1986, as amended, Section 170(h) (26 U.S.C. § 170(h))
- IRS regulations (26 C.F.R. § 1.170A–14)
- Easements Under Fire
- IRS Responds to Concerns Raised About Audits of Easement Donations
- Easement Reforms Enacted by Congress in 2006
- Office of Chief Counsel for the Internal Revenue Service Issues Memorandum Addressing the Valuation of Preservation Easements
- New IRS Reporting Requirements for Easement-Holding Organizations
- Preservation Books: Best Practices for Preservation Organizations Involved in Easement and Land Stewardship
Please note that the information provided here is intended to convey general guidance; because easements are legal tools defined by state law (and affected by federal law, if federal tax incentives are sought), the advice and assistance of a knowledgeable lawyer or other professional should be sought.