Tax Planning Information

What Your Accountant Needs

Determining your tax basis and other questions are covered in these easy-to-follow documents.

Tax Tips for Forest Landowners for the 2019 Tax Year
National Timber Tax Website
Forest Landowners’ Guide to the Federal Income Tax - 2013 Edition (PDF, 164 pp., 9MB, March 2013)
Federal Income Tax on Timber - A Key to Your Most Frequently Asked Questions (PDF, 30 pp., 973KB, Oct. 2012)
Agriculture Handbook 731: “Forest Landowners' Guide to the Federal Income Tax,” Topics covered include property exchanges, casualty losses, conservation easements, self-employment taxes, alternative minimum tax for individuals, Christmas tree production, and a system for record keeping. (English; PDF format)

Additional Resources

National Timber Tax website - provides federal tax information on all aspects of forest land taxation, including
- Timberland Acquisitions
- Structuring Ownership. “Structure” refers to how you set up your timber investment for legal and tax purposes.
- Timberland Appraisal.
- Determine Your Basis. The original basis of property is usually its cost, along with any other expenditures incurred to acquire the property.
- Record Keeping.
- Management and Operating Expenses. These are the ordinary and necessary costs associated with the day-to-day operation and management of business and investment property.
- Reforestation. Expenses Under certain circumstances you may be eligible to deduction and/or amortize your reforestation and afforestation expenses.
- Cost-Share Payments. In general cost share payments must be reported as part of your gross income unless a specific exclusion is provided by law.
- Depreciation. As a forest owner, you may depreciate most property used on your woodland if you hold your woodland as either a business or as an investment.
- Casualty Losses. For a casualty loss to occur the event causing the casualty must be a natural or other external force acting in a sudden, unexpected, or unusual manner.
- Timber Sales & Income. There are three basic ways in which income can be realized from the ownership of timber property. You may receive ordinary income from rent for use of the property or from the sale of logs, lumber, or other products you produce from the timber itself. You may also receive income from the disposal of standing timber (stumpage).
- Conservation Easements.
- Christmas Trees. Christmas tree growing because the nature of the activity, usually constitutes a business rather than an investment.
- Exchanges.