As a child, some of my favorite books let me decide what happened next. After every few pages,
the story provided the reader an option, and the reader would then turn to the page to continue
the storyline they wanted. While I prefer to think of investing as more of a strategy than an
adventure, investors, too, can choose the direction of their investment's course and tax liability.
Annual corporate meetings offer investors a chance to vote on board members, executive
compensation, and possibly some Environment, Social, or Governance issues. Some private
investments leave the entire company's direction to the shareholders - mostly seen with
conservation easement options. This strategy allows investors to chart out their economic
interests: future earnings through development or the current benefit of donating raw land.
All real property has numerous rights, and depending on location, the rights will create various
values. Instead of developing commercial properties in a sprawling metropolis or blasting a mine in a known mineral-rich area, a conservation easement option ensures the currently open land remains pristine, wildlife is protected, or public recreational space preserved. Based on tax rules for donations, the non-cash contribution values the land at its highest and best use.
Investments with a conservation easement option can be an excellent strategy for high-income
individuals to mute their federal and state income taxes - deducting up to 50% of AGI. If the
easement option is selected, the economic risks for a project transfer and become audit risk - but the IRS has yet to prevail a challenged conservation easement when the investment has followed the rules. Advantage Wealth Solutions provides access for high-income taxpayers to Regulation D securities with an easement option, allowing them to choose their own adventure.
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