LPC-2: Notification of Transfer of Land Preservation Credit (2024)
Virginia · Virginia Tax · Used for tax years 2024
Virginia Form LPC-2 notifies the Department of Taxation of a transfer of Land Preservation Credit. It reports the current credit holder, recipients, credit amounts transferred, and sale prices, and includes a schedule for allocating credits and calculating any transfer fee.
Who files this form
A credit holder who transfers Land Preservation Credits must complete a separate Form LPC-2 for each credit holder making a transfer.
If credits are transferred to a pass-through entity, an additional Schedule A must be filed to allocate the credits to its owners.
When it's due
For tax year 2024, the form recommends filing LPC-2 within 90 days of the credit transfer, but at least 90 days before filing your annual return, to avoid processing delays.
What you'll need
Have the following information ready:
- The credit holder’s legal name, SSN or FEIN, address, and contact information.
- The current credit balance, amount to be distributed, and required original Land Preservation credit transaction number.
- Each recipient’s legal name, SSN or FEIN, address, phone number, transfer date, credit amount, sale price, fiscal-filer information, and entity type.
- Pass-through entity and tax matters representative information, if applicable.
Include additional Schedule A pages if needed. If claiming the transfer-fee exemption described for a designated beneficiary or eligible successor, enclose a death certificate, will, bequest, or other instrument of transfer.
How to file
- Complete the current credit holder information on Form LPC-2.
- Sign the declaration in the presence of a notary and complete the notarization.
- Complete Schedule A. For original donations made on or before December 31, 2006, complete Sections I and III, plus Section II if applicable. For donations made on or after January 1, 2007, also complete Section IV if applicable.
- Include any required payment. Put the Land Preservation transaction number on your check or money order.
Mail the form and payment to:
Virginia Department of Taxation
Tax Credit Unit
P.O. Box 26544
Richmond, VA 23261-6544
For assistance, call (804) 786-2992. For allocations or transfers to more than 15 people or entities, the form recommends submitting a CD or disc. Call the same number for the disc format.
Common mistakes
- Transferring credits before they are issued. For donations made in 2007 and later, you cannot transfer credits until the Department has issued them.
- Assuming a December application will be processed that year. The Department cannot guarantee that an LPC-1 application received in December will be processed in time for a transfer that year.
- Combining recipients on one line. Credits are granted to one taxpayer per line per SSN or FEIN.
- Leaving out required schedules or identifiers. Use a separate LPC-2 for each transferring credit holder, include the required original credit transaction number, and file an additional Schedule A when credits go to a pass-through entity for allocation to its owners.
- Treating acceptance as approval. Acceptance of LPC-2 does not certify, approve, or validate the transfer or the credit’s valuation. All credits remain subject to adjustment upon audit.
Questions people ask
Are credits from newer donations automatic?
No. Credits from donations made on or after January 1, 2007, must be reviewed by the Department of Taxation to ensure the annual limitation is not exceeded. Some applications also need review and approval by the Department of Conservation and Recreation first.
How does Schedule A calculate the transfer fee?
Section IV applies to donations made on or after January 1, 2007. Line 1 asks for the total credit transferred or allocated, less gifts. Line 2 directs you to multiply Line 1 by 5%.
Could selling or transferring credits affect income taxes?
Yes. The form warns that a sale or transfer may have income tax consequences for both the credit holder and the recipient. It advises consulting an attorney, a tax professional, or the IRS.
Can I add pages for more recipients?
Yes. Enclose additional pages as needed. For more than 15 people or entities, the form recommends a CD or disc and asks you to call (804) 786-2992 for the format.