FAQ
What is the conservation tax credit?
A C corporation or individual that makes a qualified donation of a real property interest in North Carolina for one of the approved public benefits may be eligible for an income tax credit up to 25% of the fair market value of the land at the time of the donation.
What property qualifies for donation?
To qualify for conservation tax credits, the property must be donated in perpetuity for one of the uses listed below and must be accepted in perpetuity for the qualifying use for which the property is donated.
Qualifying Uses:
Forestland or farmland preservation
Fish and wildlife conservation
Historic landscape conservation
Public trails or access to public trails
As a buffer to limit land use activities that would restrict, impede, or interfere with military training, testing, or operations on a military installation or training area or otherwise be incompatible with the mission of the installation
Floodplain protection in a county that in the five years preceding the donation, was the subject of a Type II or Type III gubernatorial disaster declaration, as provided in G.S. 166A-19.21, as a result of a natural disaster.
The following counties are eligible for tax year 2025: Alexander, Alleghany, Ashe, Avery, Beaufort, Bertie, Brunswick, Buncombe, Burke, Cabarrus, Caldwell, Carteret, Catawba, Cherokee, Chowan, Clay, Cleveland, Columbus, Craven, Dare, Davidson, Davie, Duplin, Edgecombe, Forsyth, Gaston, Graham, Haywood, Henderson, Hertford, Hyde, Jones, Lenoir, Iredell, Jackson, Lee, Lincoln, Macon, Madison, McDowell, Mecklenburg, Mitchell, Nash, New Hanover, Onslow, Pamlico, Pender, Perquimans, Pitt, Polk, Randolph, Robeson, Rowan, Rutherford, Sampson, Stanly, Stokes, Surry, Swain, Transylvania, Union, Watauga, Wayne, Wilkes, Wilson, Yadkin, Yancey
Lands required to be dedicated pursuant to local governmental regulation or ordinance and dedications made to increase building density level permitted under a regulation or ordinance are not eligible for this credit.
For more details on eligibility requirements for each purpose, see the Public Benefit Eligibility Guidelines.
Who is eligible to accept donations?
A state agency, a local government, or an organization that is both organized to receive and administer land for conservation purposes and qualified to receive charitable contributions pursuant to GS 105-130.9, such as a land trust.
Who determines if the land is eligible?
The NC Department of Natural and Cultural Resources will coordinate the review with relevant state agencies and certify the public benefit of the property, if eligible.
What restrictions are required on the property that is donated?
The conservation values of the property must be protected in perpetuity. This is typically done through a legal document referred to here as conservation agreement. Primarily, the conservation agreement must strive to protect the qualifying public benefit(s) in perpetuity. See the Conservation Restrictions page for details.
What if the property qualifies for more than one benefit?
The property will only be certified under one public benefit. Additional public benefits will not increase the amount of tax credit.
Forestland and Farmland will receive priority consideration for the first $3.25 million tax credit value. If the property qualifies as forestland or farmland in addition to other public benefits, consider using forestland or farmland as the primary public benefit.
What happens if a donation is not accepted in the initial review?
If the property does not qualify for the selected public benefit, the applicant may reapply to a different public benefit if suitable. If the conservation agreement is not sufficient to protect the public benefit in perpetuity, it may be possible to make revisions to the agreement to ensure that it is sufficient for perpetual protection.
This will be handled case-by-case.
How is the value of the donation determined?
The NC Department of Revenue will determine the value of the donation. A landowner should contact the NC Department of Revenue for appraisal standards that will be acceptable. For fee simple absolute donations of real property, the county’s appraised value, as adjusted by the sales assessment ratio may be submitted in lieu of an appraisal report.
The landowner is responsible for maintaining and submitting records to the NC Department of Revenue to substantiate the value of the claim.
How much credit is allowed per donation?
Generally, up to 25% of the fair market value, not to exceed $500,000 for C Corporations or $250,000 for individuals, may be available for tax credit. The cap on annual credit may affect the amount of credit approved (see details below). Credit may be carried forward for five years. Additional details are found in the legislation which should be understood before applying for tax credit (see N.C.G.S. 105-153.11 and N.C.G.S. 105-130.34).
How much credit is available in total for the program each year?
A maximum of $5 million in tax credit is allowed each year for all donations. Farmland and forestland will be given priority consideration for the first $3.25 million each year. If the total demand exceeds $5 million in a year, credit will be pro-rated among all certified applications received by NCDOR.
All eligible and certified donations will be considered for tax credits on a pro-rated basis, not on a first-come, first-served basis.
What is the timeline for receiving credit?
Donations must be submitted to the NCDNCR for certification no later than January 15th of the year following the calendar year in which the property was donated. However, requests for certification are accepted on a rolling basis throughout the year and can be submitted at any time.
Landowners must submit all required documentation to NCDOR by April 15 of the year following the donation. Applications will be published on their website no later than January 1 of each year.
Tax credits may be taken for the taxable year beginning in the calendar year in which the application of the credit became effective.
For example, if land is donated in 2025, a landowner must apply to the NCDNCR for certification before January 15, 2026 and must submit the approved certification with the tax credit application to the NCDOR by April 15, 2026. If approved, the landowner would be eligible for credit in the 2026 tax year (filed in early 2027).
How long will the review process take?
Anticipated response time for donations that do not require a site visit is within 4-6 weeks for review. Site visits may be scheduled as part of the review and may require additional time.