It is never too early to begin preparing for the filing of your 2008 taxes! Forest landowners with reforestation expenses or timber harvest income in 2008 may be able to take advantage of tax incentives offered by the federal government.
The U.S. Forest Service has just released Tax Tips for Forest Landowners for the 2008 Tax Year. Free copies are available from the State Forester's office at the Oklahoma Department of Agriculture, Food and Forestry, 2800 North Lincoln Boulevard, Oklahoma City, 73105, (405) 522-6158. Visit www.forestry.ok.gov and click “Manage Your Forest” for links to this publication and other forest taxation articles.
“Landowners can better understand the tax implications from timber sales income, timber management expenses and like-kind exchanges,” said John Burwell, ODAFF State Forester. John Burwell. "The tax tips include a discussion of two of the best incentives for landowners to plant and grow trees for timber production - the reforestation tax credit, and capital gains treatment of timber income.
“Landowners interested in improving their lands and the environment, and using the greenest practices around, should take care of their forests,” he said.
The document also contains a brief overview of capital gains tax treatment of timber income, and how to handle cost-share and timber casualty losses.
"Growing timber is a long-term, often high-risk investment,” Burwell said. “The federal government recognizes this, and offers these tax incentives to small, private landowners to encourage them to grow timber and reforest their lands after timber harvest. The entire state of Oklahoma benefits as a result.”
More detailed information and assistance should be obtained from a competent tax adviser familiar with timber tax treatments.
Posted on Mon, November 3, 2008
by Jack Carson, (405)522-4575