McKenzie River Trust provides many services to landowners including helping a landowner choose a protection strategy that meets the landowner's conservation and financial needs. MRT may acquire the property through donation, hold certain rights to the property through a conservation easement or purchase the land from the landowner. Regardless of the manner in which the land is acquired, MRT's vision and duty is to steward protected lands forever.

Conservation Easements

A conservation easement is a popular and effective way for landowners to preserve the ecological value and natural beauty of their property while maintaining ownership of the land. It is a legal agreement between a land owner and McKenzie River Trust to conserve natural assets of the property and restrict some of the uses or development that may take place on the property. Generally, easements limit or prohibit subdivision of a property, commercial and industrial activity, and any activities that might disturb wildlife habitat. In turn, McKenzie River Trust assumes responsibility for monitoring the property to preserve the natural values. Once the conservation easement has been negotiated, it is documented in the property deed. Conservation easements are perpetual; which ensures the preservation and restrictions remain in effect even though ownership of the property may change.

Conservation easements are tailored to the landowner’s needs and uses, so no two easements are the same. The easement is designed to protect the natural qualities, preserve any natural or historic resources, and allow the landowner to continue healthy practices that have been carried out on the land.  The conservation easement should also fit the objectives of the easement holder, i.e. McKenzie River Trust.

Land Donations

Donating land for conservation purposes is one of the finest legacies a person can leave to future generations. A land owner may donate land for varying reasons: the land owner may not wish to pass the land on to heirs, the property is no longer in active use and the owner would like to be relieved of the responsibility of managing and caring for land, the property has highly appreciated, or the land owner may have substantial real estate holdings and wish to reduce estate tax burdens. 

When a land owner donates land to the Trust, not only is the donor released from the responsibility of managing the land, donating land can provide substantial income tax deductions and estate tax benefits while avoiding any capital gains taxes that would have resulted from selling the property. Most importantly, if the land is donated because of its ecological and conservation values, it will be protected and managed by the Trust. Although the focus of McKenzie River Trust is on land conservation, commercial and residential properties can also be donated, with the understanding that the organization will sell the land to support its conservation work on other properties.

 Bargain Sales

Bargain sales are for the land owner that would like to see the land go into a land trust by also may need to realize some immediate income from selling the land.  In a bargain sale, the land is sold to McKenzie River Trust for less than the fair market value.This not only makes it affordable for the Trust, but offers several benefits to the seller: it provides cash, avoids some capital gains tax, and entitles the seller to a charitable income tax deduction based on the difference between the land's fair market value and its actual sale price.

Bequests and Living Trusts    

For landowners who prefer to own and control their land during their lifetimes, and who do not need the income tax benefits of outright donation, a bequest may be the right fit. Many landowners wish to retain maximum flexibility during their lifetimes and choose to carry out their conservation plans through a bequest or a living trust. Landowners can conserve important lands by donating property or donating a conservation easement through their Wills.

A bequest is a provision in the landowner’s Will or a codicil (a Will amendment) that instructs the estate’s executor to convey land, property, or a conservation easement to the land trust. A living trust can achieve the same results but avoids the probate process.

Both the bequest and the living trust can assure the permanent protection of the land, permit the donor to control the property during his/her lifetime, and may reduce the donor’s taxable estate. In either case, the terms of an easement can be developed through discussions between the landowner and the land trust to achieve the goals of both.

Leasebacks

This land donation method often is used by older landowners interested in protecting their land's conservation values but want to continue using a portion of the land during their lifetime. In this scenario, the landowner donates the property to a land trust and leases the small parcel he or she wants for farming, hunting, fishing, timber cutting, or other uses. The burden of managing the land's values reverts to the land trust and the landowner receives the usual donation tax benefits.

Remainder Interest (Reserved Life Estate)

An outright donation is not the only way to give land. A landowner can donate land and continue to live on it during his or her lifetime. This is known as a gift of remainder interest, or a gift of land with a reserved life estate.

With a gift of a remainder interest, the donors and their beneficiaries reserve the right to continue to live on and continue to use the property during their lifetimes. At the end of the specified life interests, full title and control of the property automatically transfers to the land trust. In many cases, the land trust will put a conservation easement on the land and resell it. Thus, the final outcome is very similar to that of an outright gift of land.

The donation of a remainder interest offers several advantages: the donors continue to use and enjoy the property throughout their lifetimes; the property is permanently conserved and the donor may be entitled to an income tax deduction when the gift is made, if the property is a personal residence, farm, or land having conservation value. Also, if the  land trust chooses to sell the property, the proceeds will support the land trust’s land conservation program after the life interests conclude. Though such a transaction can be complicated and result in some estate tax liability if the life tenant is someone other than the donor, charitable deductions are allowed.

A remainder interest qualifies for federal income tax deduction with or without restrictions on future use. Only a remainder interest given for conservation purposes to a qualified conservation organization guarantees protection of the land values. The size of the income tax deduction for a remainder interest is figured by reducing the fair market value of the donated property by the value of the reserved life interest of the landowner or his or her designees. The more life tenants and the younger they are, the lower the value of the remainder interest and the lower the tax deduction.