Virginia Land Preservation Tax Credit: rates, caps, transfers and Form LPC-2

Q: Is this the same as a syndicated conservation easement?

No. This page describes Virginia's **state** land preservation credit for qualifying perpetual donations. Federal charitable contribution rules and IRS scrutiny of easement donations are separate issues; see also our conservation easement enforcement note for federal context.

By the Tax Field Guide editorial team. Published 2026-11-06. Facts checked 2026-11-06. Related strategies: State Conservation Credits.

Education only; not tax, legal or investment advice. Tax rules change, and how they apply depends on your facts. No outcome is guaranteed.

Virginia's Land Preservation Tax Credit (LPTC) is the Commonwealth's main transferable state income tax credit for land conservation. Landowners who permanently protect Virginia land—or a qualified interest such as a conservation easement—can earn a credit equal to a percentage of fair market value, use it against Virginia tax, or transfer unused amounts to other Virginia taxpayers. This guide summarizes Virginia Tax's program pages, Form LPC-2 instructions and Va. Code §§58.1-512 and 58.1-513. For every Virginia incentive we track, see the Virginia state page. For which other Virginia credits can (and cannot) be bought, see buying Virginia tax credits.

Who qualifies as a donor?

You may qualify if you convey land, or the right to use land (an easement), in perpetuity to a public or private group eligible to hold land for conservation or preservation. Virginia Tax lists approved land uses such as agriculture, forest use, natural resource and biodiversity conservation, historic preservation, watershed protection, scenic open space and locally designated conservation or open space. Nonprofit holders generally must be IRS §501(c)(3) organizations.¹

How much is the credit?

For conveyances in 2007 and later, the credit equals 40% of the land's fair market value, supported by a qualified appraisal prepared by a qualified appraiser under the federal charitable-contribution standards referenced in Schedule CR.²¹

Caps and annual claim limits

Issuance cap: Virginia Tax may issue no more than $75 million in land preservation credits each year, first come, first served.¹
Annual claim limit: For taxable years beginning on and after January 1, 2024, each taxpayer may claim up to $20,000 of land preservation credit per year. Earlier years had different limits—see that year's Schedule CR.²
Large applications: Credit requests of $1 million or more also go to the Department of Conservation and Recreation for verification before Virginia Tax issues them.¹

Apply with Form LPC-1 (and schedules), the recorded deed, signed IRS Form 8283, the full appraisal, appraiser affidavit and baseline documentation. Deadlines: apply by December 31 of the second year after the donation was recorded (Virginia Tax's current program page); Schedule CR also restates timing rules that differ for pre-2020 conveyances.¹²

Using the credit on a return

Claim the credit on Schedule CR with your Virginia return. Donors may generally carry unused credit forward up to 10 years. Someone who receives the credit from another person may generally carry unused amounts forward up to 11 years from the date the credit was originally issued.¹ A Virginia subtraction can apply to gain recognized when the credit is applied against Virginia tax, to the extent that gain is in federal AGI and not otherwise subtracted; transferring or applying the credit does not itself create gain or loss for the transferor or transferee.²

Transfers: buying and selling LPTCs

Any taxpayer holding a land preservation credit that originated on or after January 1, 2002, may transfer unused but otherwise allowable credit for use by another taxpayer on Virginia income tax returns.²³

Transfer fee (2% of interest ≈ 5% of credit)

For transfers and many pass-through allocations arising from donations recorded on or after January 1, 2007, Virginia imposes a fee of two percent of the value of the donated interest. Because the credit is 40% of that value, the same fee equals five percent of the credit amount transferred or allocated. Pay the fee with Form LPC-2. Virginia Tax's transferring page describes the fee as 5% of the credit; the LPC-2 instructions walk through both formulations with the same example.³⁴⁵

Common exceptions: transfers of unused credits to a designated beneficiary (or the next intestate successor) are exempt from the fee. Virginia Tax also describes fee relief in some disregarded-entity situations when supporting returns and operating agreements are filed with LPC-2.⁴⁵

Timing for Form LPC-2

File Form LPC-2 to report the transfer and pay any fee. Virginia Tax says to file within 90 days of the transfer and at least 90 days before filing the Virginia return that claims the credit. Virginia Tax then acknowledges the credit to the recipient.⁴

Practical notes for buyers

Confirm the credit originated on or after January 1, 2002, and that LPC paperwork matches what Virginia Tax issued.
Budget for the transfer fee and for the $20,000 annual claim limit (spouses may each have a limit when filing rules allow separate claims—confirm current-year instructions with your preparer).
Ask how appraisal and, if applicable, DCR review risk is handled if Virginia Tax later adjusts the credit.
Work through questions in questions to ask a tax credit broker and how state tax credit transfers work.

Virginia brokers and advisors whose public sites describe land-preservation credit transfers are listed in the advisor directory.

Common questions

Can non-landowners use the Virginia Land Preservation Tax Credit?

Yes. If you do not donate land yourself, you may still receive a transferred credit and claim it against Virginia income tax, subject to the annual claim limit and LPC-2 process.¹⁴

What is the transfer fee?

Statute sets a 2% fee on the donated-interest value for many post-2006 donation transfers and allocations; that equals 5% of the credit transferred. Beneficiary transfers at death are exempt.³⁵

How long do I have to apply after donating?

Virginia Tax's program page: apply by December 31 of the second year following the year the donation was recorded. Apply early; applications postmarked after November 1 may not finish processing by year-end.¹

Is this the same as a syndicated conservation easement?

No. This page describes Virginia's state land preservation credit for qualifying perpetual donations. Federal charitable contribution rules and IRS scrutiny of easement donations are separate issues; see also our conservation easement enforcement note for federal context.

Education only; not tax, legal or investment advice. Talk to a qualified professional before acting.

Sources

Virginia Tax, Land Preservation Tax Credit, https://www.tax.virginia.gov/land-preservation-tax-credit
Virginia Tax, 2025 Schedule CR Instructions, https://www.tax.virginia.gov/sites/default/files/vatax-pdf/2025-sch-cr-instructions.pdf
Va. Code §58.1-513, https://law.lis.virginia.gov/vacode/title58.1/chapter3/section58.1-513/
Virginia Tax, Transferring a Land Preservation Tax Credit, https://www.tax.virginia.gov/transferring-land-preservation-tax-credit
Virginia Tax, 2025 Form LPC-2 Instructions, https://www.tax.virginia.gov/sites/default/files/vatax-pdf/2025-lpc2-instructions.pdf

Professionals whose public pages show they offer a strategy covered here. Listed by number of matching strategies, then name. A listing is not a recommendation or an endorsement; see how advisors are listed, and how to vet any advisor.