FAQ

What is the conservation tax credit?

A landowner who donates their land to a state agency, a local government, or an organization that is qualified to receive the land donation 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. (See below for how much credit is available per donation.)

How does it work?

Any C Corporation or individual landowner who has land that meets any of the uses as public benefit listed below may be eligible to donate property interests in their land (fee or easement) to 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.

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 accepted in perpetuity for the qualifying use for which the property is donated.

Qualifying Purposes:

  • Forestland or farmland preservation

    • Forestland and farmland properties must be engaged in commercial growing of trees under a management program or actively engaged in commercial production or growing of crops, plants, or animals under a management program.

  • 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.

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 NCDNCR will coordinate the review of land eligibility, relying on other agencies with relevant expertise for certification. Detailed review criteria will be available later this summer.

How should the value of the donation be substantiated?

An appraisal report that conforms with the Uniform Standards of Professional Appraisal Practice is required to be submitted to the NCDOR. 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 NCDOR 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 in a given calendar year must be submitted to the NCDNCR for certification. Requests for certification are accepted on a rolling basis throughout the year but must be submitted by January 15 of the year following the donation.

Landowners must submit all required documentation to NCDOR by April 15 of the year following the donation.

Tax credits may not be taken for the year in which the donation was made but 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 starting in the 2026 taxable year (filed in early 2027).

Off