Tax Structures are Available that Enhance Profitability on Private Woodlands

Woodlands dominate New York and 70% of the land is owned by approximately 500,000 private woodland owners. These owners make decisions about when and how to manage their property. Many decisions have financial ramifications. These owners, their foresters and their financial/tax advisors should consider woodland-based tax considerations to optimize their economic situation. Some examples of specific situations that might prompt forestry reporting on the annual federal tax return include: woodland acquisition, management plan development, timber or firewood sales, purchase of supplies or equipment for active management, and reforestation. New this year, the IRS requires all timber sale transactions to include a 1099 form.

The majority of woodland owners, foresters, and tax prepares have limited exposure to current information that addresses federal tax issues for private woodlands. Owners need to make decisions about their passive versus active role in management, determining their basis, structuring their management plan for optimal tax advantages, allowable deductions, accounting for federal cost-share payments, and more. Because owners infrequently address these issues they look for professional assistance – yet commonly owners struggle to find assistance.

Cornell University Cooperative Extension offers a workshop through the US Forest Service tax team on “Optimizing Woodland Finance: Timber Revenue Management and Tax Structures.” This workshop is designed for anyone who has a role in advising or preparing federal tax returns associated with private woodlands. Tax preparers (CPAs and Enrolled Agents), foresters, land trust managers, and real estate advisors at banks, are common participants. Some woodland owners actively contribute to tax preparation and would benefit from the workshop.

Participants receive a large 3-ring binder of presentation materials, example worksheets, sample federal forms, and supplemental reading. Participants have the option of including their contact information on the Cornell University Forestry Extension webpage for reference by forest owners and others. Continuing education credits are available for CPAs, enrolled agents, and foresters.

This workshop will be held hosted on October 6 by Cornell Cooperative Extension of Oneida County in Oriskany and again October 8 by Cornell Cooperative Extension of Clinton County in Plattsburgh. Pre-registration is required. More information is available at www.ForestConnect.info where you may also register on-line with a credit card, or mail your name, address, e-mail, phone and your check in the amount of $70 made payable to: Cornell University, to: Tax Workshop, 108 Fernow Hall, Ithaca, NY 14853. If you need more information, please contact Diana Bryant at dlt5@cornell.edu or 607-255-2115. Registrations must be received by noon on September 30.

Tax Structures are Available that Enhance Profitability on Private Woodlands

M3P Media LLC © 2009