What's happening
This bill exempts certain farmland and conservation land from transfer taxes, but imposes a tax if the land use changes.
Why it matters
Encourages long-term farmland and conservation land protection. By exempting these lands from transfer taxes at inheritance or gift, the bill provides a strong financial incentive for families and organizations to maintain agricultural and conservation uses, supporting open space preservation.
Imposes a “clawback” if land use changes. Heirs or recipients who convert the land to non-farm or non-conservation purposes, or sell it without maintaining restrictions, become liable for the previously-exempted estate tax. This deters speculative holding and rapid development after transfer.
Supports intergenerational farm continuity. Reducing estate tax burdens on inherited farmland makes it easier for family farms to stay in business across generations, potentially stabilizing rural communities and local food production.
Links tax benefits to legal definitions and conservation tools. The bill ties eligibility for the exemption to legal definitions of farm operations and conservation easements, ensuring only bona fide agricultural and conservation lands benefit, and not speculative or loosely-defined property holdings.
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Who cares
Farm owners and their estates
The bill would exclude qualifying New York farmland from a deceased resident’s New York gross estate and exempt qualifying gifts from the taxable-gift addback.
Owners of conservation-restricted land
Land covered by qualifying conservation easements or agricultural or natural-resource conservation covenants would also qualify for the estate exclusion.
Heirs to qualifying land
Heirs would face an additional estate tax if they violate land-use restrictions or dispose of an interest to someone not subject to those restrictions.
New York State tax administrators
The bill would establish an additional estate tax to recapture the exclusion and a state lien equal to the adjusted value attributable to qualifying land.
Headline styles
Protect Farms and Open Land
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to ways and means
- Referred to ways and means
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Protect Farmland from Taxes
In Senate Committee · Investigations And Government Operations · Sponsor Kenneth P. LaValle
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
S. 4256 A. 5275
2017-2018 Regular Sessions
SENATE - ASSEMBLY
February 7, 2017
IN SENATE -- Introduced by Sen. LAVALLE -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
IN ASSEMBLY -- Introduced by M. of A. THIELE -- read once and referred to the Committee on Ways and Means
AN ACT to amend the tax law, in relation to granting an exclusion from transfer taxes for certain farmland and land of conservation value
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. This act shall be known and may be cited as the "farmland and open space preservation act of 2017".
§ 2. Section 951-a of the tax law is amended by adding two new subsections (g) and (h) to read to follows:
(g) The term "farm operation" shall have the same meaning as defined in subdivision eleven of section three hundred one of the agriculture and markets law.
(h) The term "conservation easement" shall mean an easement, covenant, restriction, or other interest in real property acquired for the preservation of agricultural lands used in bona fide agricultural production, pursuant to section two hundred forty-seven of the general municipal law.
§ 3. Subsection (a) of section 954 of the tax law, as amended by section 3 of part X of chapter 59 of the laws of 2014, paragraph 3 as amended by section 2 of part BB of chapter 59 of the laws of 2015, is amended to read as follows:
(a) General.-- The New York gross estate of a deceased resident means his or her federal gross estate as defined in the internal revenue code (whether or not a federal estate tax return is required to be filed) modified as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07702-01-7
S. 4256 2 A. 5275
(1) Reduced by the value of real or tangible personal property having an actual situs outside New York state.
(1-a) Reduced by the value of real property situated in the state which, on the date of the decedent's death was land used in support of a farm operation; upon which there was a conservation easement; or upon which there was a covenant restricting the use of the land to agricultural or natural resource conservation purposes.
(2) Increased by the amount determined under section nine hundred fifty-seven of this part (relating to limited powers of appointment created prior to September first, nineteen hundred thirty).
(3) Increased by the amount of any taxable gift under section 2503 of the internal revenue code not otherwise included in the decedent's federal gross estate, made during the three year period ending on the decedent's date of death, but not including any gift made: (A) when the decedent was not a resident of New York state; [or] (B) before April first, two thousand fourteen; [or] (C) that is real or tangible personal property having an actual situs outside New York state at the time the gift was made[.]; (D) or that is real property used in support of a farm operation, subject to a conservation easement, or subject to a restrictive covenant as described in paragraph one-a of this subsection. Provided, however that this paragraph shall not apply to the estate of a decedent dying on or after January first, two thousand nineteen.
§ 4. The tax law is amended by adding a new section 954-a to read as follows:
§ 954-a. Additional tax if land used in support of a farm operation, subject to a conservation easement, or subject to a restrictive covenant as described in paragraph one-a of subsection (a) of section nine hundred fifty-four of this part is no longer used for such purposes. (a) If, at any time after the decedent's death and before the death of the heir, the heir: (1) disposes of any interest in real property that is used in support of a farm operation, subject to a conservation easement, or subject to a restrictive covenant as described in paragraph one-a of subsection (a) of section nine hundred fifty-four of this part and the person acquiring such interest is not subject to the restrictions on use described in paragraph one-a of subsection (a) of section nine hundred fifty-four of this part, or (2) the heir uses such land in any manner which violates the terms of such restriction, then, there is hereby imposed an additional estate tax.
(b) The amount of the additional tax imposed by this section shall be the amount equal to the excess of what would have been the estate tax liability but for the reduction provided in paragraph one-a of subsection (a) of section nine hundred fifty-four of this part.
§ 5. Section 982 of the tax law is amended by adding a new subsection (a-1) to read as follows:
(a-1) Farmland and conservation land exclusion. An amount equal to the adjusted value attributable to real property used in support of a farm operation, subject to a conservation easement, or subject to a restrictive covenant as described in paragraph one-a of subsection (a) of section nine hundred fifty-four of this article shall be a lien in favor of the state.
§ 6. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.