FREQUENTLY ASKED QUESTIONS
The Exchange was created to make a market in South Carolina Conservation Credits made available to South Carolina landowners and taxpayers via the Conservation Incentives Act (Act 283) passed by the Legislature in 2001.
Since 2014, the Exchange also makes a market in SC Angel investor Credits earned via the High Growth Small Business Job Creation Act.
We chartered the Exchange to assist those landowners and land trusts wishing to take advantage of the SC Conservation Credits by providing a simple, credible, one-stop shopping option for sellers and buyers of conservation credits to get together.
In short, everybody!
- Landowners donating easements eligible for conservation credits are assured of high cash value for those credits they do not or cannot use;
- Land Trusts are able to focus on that part of the conservation deal for which they were created – providing easements and long-term monitoring — while leaving the “banking/exchange” function to others. This avoids a possible conflict of interest if a Land Trust were to provide the easement as well as serve the exchange function;
- Taxpayers purchasing credits enjoy immediate tax advantages through the power of dollar-for-dollar tax benefits gained at less than face value;
And finally, all citizens of South Carolina benefit, as the Exchange helps to further the conservation of South Carolina’s natural and cultural heritage and investments in high growth small businesses.
Credit for the framework of the Exchange belongs to Carlton Owen, president and CEO of US Endowment for Forestry and Communities, and Cary Hall, tax attorney and partner in the Wyche Law Firm based in Greenville, SC.
Once a landowner donates a qualified conservation easement to a land trust and all the paperwork is done, South Carolina law provides for credits against South Carolina taxes for the donor to either use against their own taxes or to donate or sell to others.
For easements donated after May 31, 2001 on a qualified property in South Carolina, a tax credit may be earned equal to 25% of the deduction but not more than $250 per acre. Any unused credit may be carried forward until used or can be sold to another taxpayer upon written notification to, and approval of the transfer by, the SC Department of Revenue.
The Exchange ensures that all necessary paperwork and approvals are obtained and brokers the transaction on behalf of the sellers and buyers.
Before agreeing to make a market in specific credits we review the organization accepting the easement, the vendor conducting the valuation appraisal, and the conservation purposes served. We review the entire transaction to attain a high degree of confidence that the transaction is of the highest conservation quality and in full compliance with all codes and regulations. In short, the Exchange is your “Good-Housekeeping Seal of Approval” of the quality of the underlying transaction.
Working through the South Carolina Conservation Credit Exchange provides many benefits to the seller of credits…among them:
- Top dollar … for your credits with minimum effort on your part;
- Simplicity … with one-stop shopping in dealing with all aspects of the transfer from finding and qualifying buyers to completing forms and working with the Department of Revenue;
- Integrity and credibility … by working with trusted and proven individuals who share your commitment to conservation; and investments in SC businesses.
Working with and through the South Carolina Conservation Credit Exchange provides credit buyers with many benefits … among them:
- Value … through the purchase of credits at a fair price to the seller and yet with a margin to make the purchase worth your while in terms of residual tax value;
- Simplicity … via one-stop shopping for credits that have been pre-approved and that are most likely to stand the test of time and reviews by the Department of Revenue and the IRS;
- Peace of mind … in knowing that the credit you are buying has met rigorous reviews and an independent set of eyes beyond that of the receiving organization; and
- Conservation … in knowing that by working through the Exchange you are helping to protect important conservation lands and encouraging economic growth in South Carolina.