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September 26, 2005
National Architectural Trust
I don't recall seeing any discussion of the National Architectural Trust on this site. Has anyone used them to donate a facade easement? Any IRS problems? (There was a 12/12/04 NYTimes article indicating that the IRS viewed these easement deductions as excessive as the facades in question were already protected from changes by Landmark laws.)
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i read the same ny times articles and actually contacted the trust to have someone come out to my house. no one ever contacted me back. i know i need to follow up...
Posted by: pietro at September 27, 2005 10:31 AM
I would stay away from the National Architectural Trust. They are not a legitimate preservation foundation. They were set up solely to take advantage of the tax loophole. They have been stopped by the IRS from soliciting new donations. This means, probably, that they are going to go under. And when they do, what happens to the portion of your house that they own? And what's worse, the IRS may come after you for taking an illegal deduction. STAY CLEAR.
Posted by: CH at September 27, 2005 4:07 PM
How do you know the IRS has stopped them from taking donations? There is also the National Trust for Historic Preservation which was set up by Congress that does historic preservation easements. The issue as I recall was whether the tax deductions for the easements in already landmarked areas were valid. The value of the easement was questioned because there already is a restriction on the modification of the facade under the landmarks regulation.
However, in defense of the easement program, it would be an additional defense to any planned modification or demolition of a landmarked (or nonlandmarked structure) and the easements do more than just limit the modification of the facade, but also require preservation (i.e. upkeep so the facades are not lost due to neglect).
I'd like to know more too. I'm thinking of doing it. My brownstone is not on a landmarked block but it is part of a National Register of Historic Places historic "district". Would need to consult my accoutant/tax lawyer.
Posted by: Anonymous at September 27, 2005 5:38 PM
I was dimly aware of the facade easement program and approached NAT after reading the Times article -- understanding that the door might have closed on this opportunity but feeling it was worth checking out. I had a couple of decent conversations with a guy there called Tim Gunn (212-595-8367). He sent me a package of materials and told me the situation was up in the air. Then I dropped the ball. But I'm curious to know if anyone has tried it recently or heard any updates. The tax savings is considerable: you take a deduction based on the presumed 10-15% "loss" of value (ie. 10-15% of the current value of your house) incurred by donating the easement. However there's an approx $15,000 total cash outlay between needing a new appraisal, bank fees and the fee/donation to NAT themselves. I guess that's what gave me cold feet!
Posted by: Roz at September 28, 2005 5:38 PM
I went to one of their informational meetings a few years ago. A BIG minus was the $10,000 a year you have to pay them to maintain the easement. If you make a lot of money you might be able to make the numbers work but the whole thing smelled scammy, despite the bow tie the presenter was wearing.
Posted by: beckers at September 30, 2005 2:48 PM
The National Trust for Historic Preservation is a legitimate trust whose sole aim is to preserve historically significant places. The National Architectural Trust's sole aim is the marketing of a tax shelter. This tax shelter was named one of the IRS "Dirty Dozen" last year.
In response to the anonymous poster, I know that they can no longer solicit donations because I contacted the National Architectural Trust when I was considering purchasing a home with a facade easement. I also contacted the reporter from the New York Times to discuss this issue. The congressional investigation and IRS publicity surrounding these easements should definitely give homeowners pause. It's very short sighted. The tax benefit you could get in the short term might be a huge liability down the road. If you're looking to sell you're home in the future, you can bet that any prospective buyer is going to do research on the easement. The best case scenario is you have to sell them on the annual fee. The worst case scenario is that the National Architectural Trust no longer exists and the ownership of your facade is tied up somewhere in federal court. Goodbye buyer, hello IRS investigation.
Posted by: CH at October 3, 2005 10:54 AM
Thanks for doing the homework, CH
Posted by: LG at October 3, 2005 2:29 PM
As President for the National Architectural Trust, I would like to clarify some of the comments made in this string of messages. Unfortunately space does not allow me to address them all.
The National Architectural Trust is an approved 501(c)(3) charitable organization qualified by the federal government to protect historic properties through the acceptance, monitoring and enforcement of façade conservation easements. We are the leading historic trust with this focus, holding greater than 550 easements nationwide and more than $12 million in our Stewardship Fund. This fund guarantees our ability to honor our commitment to forever protect these irreplaceable historic structures.
Concerning the façade conservation easement program, the voluntary donation of a perpetual right on one's property for the purpose of protecting the character of our historic communities is imperative to creating America's architectural legacy. An easement, as mentioned by one writer, protects both the architectural and structural integrity of the building and remains in force regardless of changes in ownership, zoning regulations and local landmark laws. The historic preservation community is in strong support of this program and many leading organizations, besides ourselves, have written Congress showing their support. Some of these organizations include the National Conference of State Historic Preservation Officers, the Advisory Council on Historic Preservation and the National Trust for Historic Preservation.
I invite you to visit our website at www.natarchtrust.org which is continually updated with information about our organization and the status of this very important program.
James M. Kearns, jkearns@natarchtrust.org
Posted by: Anonymous at October 21, 2005 11:36 AM
Although the primary focus of the National Architectural Trust is the acceptance, monitoring and enforcement of façade conservation easements that in itself is a major contribution to the historic preservation effort, it has also made major contributions in support of local NYC efforts to restore historic landmarks, monuments, parks and streets, and fund education programs on the benefits of preserving historic architecture.
These contributions to NYC include projects to restore historic cobblestone streets in Greenwich Village (David Dunlap wrote about this initiative in the New York Times on January 16, 2005, a copy of which can be viewed at: http://www.natarchtrust.org/preservation/inthecommunity/neightborhoodrestoration.asp#s2); multi-year support of the Parks Department Citywide Monuments Conservation Program (WNBC recently broadcast a story on the project to conserve the Fort Washington Monument in Washington Heights); sponsorship of the NYC-based World Congress on Art Deco in May of this year; financial support of the Highline project; expertise for placement of several historic NYC communities on the National Register of Historic Places; and sponsorship of an education program on the architectural history of skyscrapers by the Museum of Modern Art, to name a few. The National Architectural Trust is an excellent organization and highly active in the preservation of our historic communities. Please visit the Trust’s website for more information on these activities: http://www.natarchtrust.org/preservation/inthecommunity/
Posted by: Tim Gunn at October 21, 2005 12:36 PM
As a NYC representative of the National Architectural Trust, I would like to clarify some of the misinformation found on this forum. The National Architectural Trust has received no notification from the IRS that is under investigation, nor has it been prevented from continuing to accept donations of facade conservation easements. However, given recent questions raised by the IRS concerning the independent valuation of easements (both facade and open space) which apply to donations received by ALL active recipient organizations, the Trust has suspended the active promotion of this program until further clarification has been provided by the IRS and/or Congress. Nevertheless, the Trust remains fully committed to the use of easements as a program essential to the long-term preservation of historic properties and neighborhoods, and is continuing to accept donations in order to further this objective.
In addition, the predominant issue highlighted by the IRS is overvaluation of easement donations. An independent appraisal completed by a qualified, professional appraiser is a legal requirement. NYC has a number of these qualified appraisers. The donor should make sure that he/she is comfortable with the appraiser, the amount of the easement valuation and the details of the appraisal itself. It is also strongly suggested by the Trust that donors confer with their own legal and tax advisors before making a donation.
Finally, it is also worth mentioning that there is no annual fee assessed by the Trust for the administration of a facade conservation easement. When an easement is received by the Trust, the Trust also requests a one-time cash contribution to our Stewardship Fund from the donor. That contribution is the only funding the Trust receives for the administration of the easement in perpetuity. There are no ongoing costs to the property owner for administration or for the processing of change requests.
Sean Zalka, Area Manager
Posted by: Sean Zalka at October 24, 2005 3:16 PM
Easements on properties do offer additional protection against demolition or insensitive alterations even when the property is already protected by local landmark restrictions. Local landmark ordinances are vulnerable to change or removal in the future, while easements are granted forever and remain unaffected by political and commercial pressures. Also, local landmark ordinances do not prevent demolition by neglect, whereas easements require that properties be maintained. There are also hardship clauses in the local landmarks law which the easements do not abide by. Financial hardship is often successfully cited as a reason for not abiding by landmarks restrictions.
Posted by: CZ at October 25, 2005 11:41 AM
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