Green Horizons

The Missouri Forest Products Association has recently launched on online forum where landowners can announce their pending timber sale. Anyone can view pending sales by visiting the Association’s website at www.moforest.org/timbersale.php. The system is designed to be easy. An individual goes to the MFPA website and posts their sale. After it is posted, the sale will be added to the current list and all MFPA members will be automatically notified of the new posting. This direct marketing tool has the potential to greatly increase the number of bids received. Basic information requested to post your sale online includes address, email, species, estimated volume, county location, number of treated acres, and a bid deadline. For more information contact MFPA Communications Coordinator Rodric Bradford at (573) 634-3252 or rodric@moforest.org.

Basis and Tax Records

Part of the price you receive from a timber sale is taxable income, but part is also your investment (i.e. your basis) in the timber sold. Allocate your total costs of acquiring purchased forestland - or the value of inherited forestland - among land, timber, and other capital assets as soon as possible. Adjust your basis up for new purchases or investments and down for sales or other disposals.

When you sell your timber, you can take a depletion deduction equal to (adjusted basis ÷ total timber volume just before sale) x (timber volume sold). Good records include a written management plan and a map of your woodlands. Keep records that support current deductions 6 years beyond the date the return is due. Keep records of your basis 6 years beyond your period of ownership. Report adjustments to basis and timber depletion on IRS Form T (Timber), Part II. For more 2004 tax tips, visit www.timbertax.org.