A facade easement is a type of conservation easement which is designed to maintain the historic character of a building’s facade. When a facade easement is created, the owner of a building agrees not to make changes to the facade without confirming that they will not compromise the historic value. The easement is donated to a nonprofit organization which accepts conservation easements and holds them in trust. Numerous cities have organizations which handle historic conservation easements.
For the building owner, the advantage of a facade easement is that it entitles the owner of the building to a tax break. The easement restricts development of the property’s facade, and government agencies recognize that this can bring the value of the property down. Hence, people are allowed to use the easement as a tax deduction to reduce their property tax, treating the easement as a charitable contribution.
In several nations, the use of facade easements as tax deductions has veered into the realm of abuse. For this reason, some governments have set out specific rules about how historic conservation easements work, with the goal of reducing abuses. People with such easements are also subject to audits to verify the claims made in the easement agreement, including audits to check to see that the facade is being left in historic condition, with no changes which might violate the terms of the easement.
In order to qualify for a facade easement, a structure needs to be of historic value. However, if the home is in a historic district with development restrictions, it cannot receive an easement. This is because whether or not homes in the district have easements, their facades must be left intact to comply with the development restrictions. Thus, the owner of a property does not need to put it in trust with an easement to protect its historic character, and a facade easement would not devalue the structure at resale because development in the entire neighborhood is restricted.
Laws about conservation easements vary from nation to nation, and it is advisable to consult a lawyer to get specific advice. As a general rule, if the intent behind an easement is a genuine desire to protect a structure’s historic character and value and such protections are not in place in the area where the structure is located, the easement is probably legal. Filing for an easement with the goal of reducing tax liability, however, can ensnare people in problems. It is also wise to work with a well established and trusted organization which accepts conservation easements, ideally an organization which works in the community, rather than one located somewhere else.