Is anyone have their property classified as "Managed Forest?"

[canfossi]

I was wondering if anyone here has their property classifed this way? Are you allowed to write expenses off if they are used for work in the managed forest? Mine doesn't produce any income for me, but can I write anything off? Thanks Chris

[michiganfarmer]

I think Ken Scarborough does. He is a moderator

Actually its Ken Scharobok.

Pardon me

[ET1 SS]

Around here they call it: "Tree-Growth".

I am a woodlot owner and manager. We are required to hire a certified forester, to write a 'management plan', and so long as we follow that plan we are 'good'. It sets the assessed value of the land at a very low amount, so the property taxes on the land are very low.

Our 'management plan' is like a book, and has sections for if we want to let it go wild, or if we want to operate a tree nursery, or firewood, or Christmas trees, timber, etc. So really our plan is open enough that we can do about anything that you would ever want to do within a forest.

Since we now manage a woodlot, we file a schedule 'F' on it, and we write-off those expenses.

[Junkmanme]

If the gov't tried that ploy with me, no matter the "designation", I would protest and go so far as to sue them for "Decaratory Judgement" as to whether they can indescriminately "decide" 'WHAT'S WHAT'......They MUST JUSTIFY the designation.....

I surely get tired of the "crooked ploys" that gov't employees use to steal your property rights!!!!!

[Runestone]

I'm just looking into this for my property. Check out this link

www.oforest.on.ca

From what I have read, it is a plan that allows you to have your property taxed at 2 different rates which can really save a lot of $$. It is similar, I think, to the farm tax credit system.

Hope that helps

[agmantoo]

I am a small scale tree farmer. All of my properties have formal management programs and I get tax relief based on the growing of trees in NC, SC, but not in VA. VA allows counties , not the state, to determine which counties participate in the tax relief. I do file a schedule F. Some expenses are taken for the year they occurred and others are deperciated over time. In the states that I can get tax relief it certainly justifies to qualify. If it were not for the lower taxes I could not justify owning the properties. I am selling the acreage in VA due to the lack of the program in Brunswick county. If Brunswick county wants nothing but development then I am going to help them with their wishes. Otherwise the land there would be going into a trust and would remain as tree land for the future.

[highlands]

We do sustainable forestry and manage our woods for lumber, veneer, pulp & firewood as well as having field areas, marshes and wildlife goals. We have a management plan that we update about every ten years. We've divided the property up into sub-sections based on how we manage each of them which makes planning easier. Our land provides all of our own wood needs plus we sell more than enough to cover our (substantial) real estate taxes.

To your direct question, if you're not producing any income then you probably can't write off any expenses but of course, consult the IRS tax documents to be sure for your specific situation.

Cheers

-Walter
Sugar Mountain Farm
in the mountains of Vermont
http://SugarMtnFarm.com/blog/
http://HollyGraphicArt.com/
http://NoNAIS.org

[ET1 SS]

Originally Posted by highlands

... if you're not producing any income then you probably can't write off any expenses but of course, consult the IRS tax documents to be sure for your specific situation.

Generally if you operate a business, and your intention is to make a profit sometime, then your good.

[bergere]

Lets just say it is not worth it in Oregon. Looked into..what a joke.

[ET1 SS]

*warning in this post some of the numbers I quote will be rough approximations, I am not going to take the effort to find the exact numbers for this discussion*



Here when land is in "Tree-growth" the tax assessed value of the land is set at a very low amount [for example $100 per acre for hardwoods, $150 per acre for softwoods, etc].

So the annual tax bill [the mil-rate times your assessed land value] will come out to being maybe $1 per acre. [ours has actually been around $1.05 per acre]

Whereas, if they had taxed it at the purchase price of the land, $300 per acre to $1,000 per acre, then your tax bill would be between $3 and $10 per acre.

If you own 100 acres; under 'treegrowth' you pay $100 property taxes. Without 'Treegrowth' you could pay from $300 to $1,000 annual property taxes [assuming they assessed the land at the purchase price].

I just took one acre of my forest out from the 'treegrowth' plan. To account for my driveway, house, barn and garden. My property as a whole is riverfrontage. And in some areas of the county, riverfrontage land has a market value up in the $80,000 - $90,000 per acre range. So the tax assessor set the assessed value of this one acre [which in itself has no river access] at somewhere around $86,000. I only bought it two years ago for $900 per acre. But this is the new assessed value. So we just got a new tax bill. Just for this one acre of non-treegrowth land: $860.

So next year my property taxes will be $860 [for the land under my house and barn] + $46 for 41 acres of surrounding forest: $906.

I see the 'Treegrowth' idea as a value, to encourage folks to keep land in forest.

Around here you can still do pretty much anything you want to do with the land, so long as it still grows trees. Obviously clearing an area for a house foundation, is going to limit the trees that grow right there. But you can drag in a one-room cabin on a sled, and not interfere with the 'treegrowth' concept.

[kabri]

Our property is zoned CF=80 (commercial forest, 80 acre or more) and is taxed accordingly (very low!) We also were required to file a management plan. Our trees are at least 15 years away from harvest. But all the expense we go to to maintain the roads (gravel, grading & ditching) pre-commercial thinning, chain saws and supplies, and even the cost of surveying the boundaries (to prevent errors in harvest) were all write-offs on our taxes. We are going to develop our homestead on about 8 acres of this, but none of that expense counts as "forest management". This is in WA State. We were fortunate that our accountant has other clients in the state who are either forest land owners or loggers so he was up to date on the tax laws for us here. I hope this is helpful to you!