Related Resources

Below are resources that may be useful to you as forest landowner. They are grouped according to their utility.

Establishing your tax basis in land and timber: When you acquire land, you should always establish your tax basis in the land and in any improvements and in the timber.  Depending on how you acquire the land, your tax basis may be very high or very low. It is important because it will determine what taxes you will owe when you sell all or part of the land or timber, or what your heirs will pay when they do. The best time to establish the basis in timber is when you acquire the land, but the timber basis can be established later.  It must be established prior to its harvest, however.

Present Use Value (PUV) Tax treatment:  In NC, present use value tax rates are frequently significantly lower than the rates based on highest and best use.  The PUV treatment is dependent on a number of factors.  These sites describe the requirements to qualify. Other states have similar programs (Green belt  in FL, forest land  conservation use in GA, agricultural use in SC, etc.)

1031 tax deferred exchanges:  When buying and selling land, there may be opportunities to defer taxes on the gain by “exchanging like kind property”.  The first step is identifying like kind properties prior to closing that might be purchased as part of the exchange.  Then the buyer has 180 days from closing to purchase the properties being exchanged for the sale property.  Upon closing, the seller does not take possession of the sale proceeds. They are received by a “qualified intermediary”, who then uses the sale revenue to purchase the property identified for the exchange.  Taxes are eventually paid on the gain when the property purchased in the exchange is sold.  There are numerous requirements to qualify and execute a 1031 exchange and the services of an attorney or firm that specializes in 1031 exchanges is highly recommended.

Forest Management, fire control, fire prevention, forest pests: If you have forest land, you should manage it, just as you would a portfolio or a business.  You need an assessment of what you have on the land, objectives for your ownership and a plan to get you there.  You need to know the risks associated with your forest land and options for mitigating risks.

Forest Management

Burning permits

Fire conditions

Fire prevention

Invasive exotic plant species

Insects and diseases

Cost share programs:  There are opportunities to get cost sharing for many forestry activities, such as site preparation for tree planting, tree planting, crop tree release, timber stand improvement, brush control and pre-commercial thinning and wildlife habitat improvement.  The sites below have information about some of the most commonly used programs.

Forest Development Program (NCFS)

Environmental Quality Incentives Program (EQIP) (NRCS)

Southern Pine Beetle Prevention Program

Just interesting stuff: