The New York State Conservation Easement Tax Credit (CETC) offers New York taxpayers whose land is restricted by a conservation easement an annual New York State income tax credit of up to 25% of the school district, county and town real estate taxes paid on the restricted land, up to an annual maximum of $5,000 per taxpayer. Unlike a tax deduction, which is an adjustment to taxable income, a tax credit offsets a taxpayer's tax liability on a dollar­for­dollar basis. The CETC is a REFUNDABLE income tax credit, which means that if a landowner's tax credit exceeds the amount he or she owes in state income taxes, the landowner gets a check for the difference. The CETC is available to individual landowners, estates, trusts, partnerships and certain corporations as long as the land they own is restricted by a perpetual and permanent conservation easement.

To qualify for this tax credit, the land must be located in New York State and the conservation easement must be held by a public or private conservation agency. The easement must serve to protect open space, biodiversity or scenic, natural, agricultural, watershed, or historic preservation resources by limiting or restricting development, management and/or use of the property.

They DO NOT APPLY to non­conservation easements, such as utility or transportation rights-of-­way, etc. Nor do they apply to conservation easements that were created for the purpose of obtaining subdivision or building permits or to easements that were required as mitigation. You can claim a tax credit for each of the qualified easements on your land up to a total of $5,000 per year for all of them.

In order to claim a CETC, a landowner will need the following information:

• Location of the easement­restricted property (it should appear on the easement).
• Date the easement was conveyed.
• The county the easement was recorded in, the liber and page instrument number or control number.
• The DEC identification number assigned to the easement.
• County, town and school district property taxes paid on the easement­restricted land.

The landowner claims the CETC when filing his or her state income tax returns:

• Individual landowners file the new Form IT­242 with their personal NYS income tax returns: IT­201 for NY residents and IT­203 for nonresidents and part­year residents.
• Estates and trusts file Form IT­242 with Form IT­205 to show each beneficiary's share of the credit.
• Partnerships file Form IT­242 with Form IT­204, showing the total amount of the credit.
• Corporations file Form CT­242 with Form CT­3 or CT­3­A.