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12 members (gregnbc, Stacey, Exhoosier, dustymac, JD53, BrandonClark, odocoileus, Thread Killer, fish251, mcninja, Bglen, 1 invisible),
675
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Key:
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Global Mod,
Mod
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Joined: Jun 2021
Posts: 5,635 Likes: 34
Inter Loin Gourmet
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Inter Loin Gourmet
Joined: Jun 2021
Posts: 5,635 Likes: 34 |
I am having some timber cut, how is the money made from the sale taxed?
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Joined: Sep 2001
Posts: 1,247 Likes: 18
8 point
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8 point
Joined: Sep 2001
Posts: 1,247 Likes: 18 |
You will hate my answer….it depends.
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Joined: Apr 2017
Posts: 18,058 Likes: 43
Old Mossy Horns
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Old Mossy Horns
Joined: Apr 2017
Posts: 18,058 Likes: 43 |
You will hate my answer….it depends. Beat me to it. 
We’re not dead. We just smell that way. Dayum. - AC870
Yessir! I’m always gonna shoot what makes me happy and I want everyone else to do the same! If you shoot one be proud of it and don’t worry what anyone else thinks. - SJ22
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Joined: Jun 2021
Posts: 5,635 Likes: 34
Inter Loin Gourmet
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Inter Loin Gourmet
Joined: Jun 2021
Posts: 5,635 Likes: 34 |
Yeah I have readed some on the US forest service website and it has my head spinning!
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Joined: Nov 2011
Posts: 22,603 Likes: 22
Freak of Nature
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Freak of Nature
Joined: Nov 2011
Posts: 22,603 Likes: 22 |
The value of the timber cut - the value of the timber when you purchased or inherited the property (basis) = taxable amount. That amount is taxed and I believe it’s ordinary income. If you don’t know what the timber was worth when you bought it, you can have a retroactive timber cruise done to approximate basis. Yeah I have readed some on the US forest service website and it has my head spinning! It’s not the US Forest service that matters. It’s the IRS.
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Joined: Aug 2003
Posts: 44,377 Likes: 28
Freak of Nature
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Freak of Nature
Joined: Aug 2003
Posts: 44,377 Likes: 28 |
LUCK:::; When presistence, dedication, perspiration and preparation meet up with opportunity!!!
- - - - - - - -A government big enough to give you everything you want, is big enough to take everything you have. Thomas Jeferson - - - - - - - -
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Joined: Dec 2002
Posts: 14,332 Likes: 65
Booner
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Booner
Joined: Dec 2002
Posts: 14,332 Likes: 65 |
Timber tax web site is a good tool.
Everything woke turns to shucks
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Joined: Dec 2002
Posts: 14,332 Likes: 65
Booner
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Booner
Joined: Dec 2002
Posts: 14,332 Likes: 65 |
Everything woke turns to shucks
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Joined: Jun 2021
Posts: 5,635 Likes: 34
Inter Loin Gourmet
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Inter Loin Gourmet
Joined: Jun 2021
Posts: 5,635 Likes: 34 |
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Joined: Jul 2011
Posts: 39,938 Likes: 130
Freak of Nature
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Freak of Nature
Joined: Jul 2011
Posts: 39,938 Likes: 130 |
Get an accountant that knows how to handle timber sales. Most will have you paying too much using capital gains tables.
"Why do you ask"?
Too many people spend money they don't have , on things they don't need, to impress people they don't know.
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Joined: Jun 2021
Posts: 5,635 Likes: 34
Inter Loin Gourmet
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Inter Loin Gourmet
Joined: Jun 2021
Posts: 5,635 Likes: 34 |
let's just say when I got it and it appraised for 100k and sell it 100k, is that no tax?
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Joined: Sep 2001
Posts: 1,247 Likes: 18
8 point
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8 point
Joined: Sep 2001
Posts: 1,247 Likes: 18 |
let's just say when I got it and it appraised for 100k and sell it 100k, is that no tax? it depends.
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Joined: Jun 2016
Posts: 2,172 Likes: 19
8 point
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8 point
Joined: Jun 2016
Posts: 2,172 Likes: 19 |
Get an accountant that knows how to handle timber sales. Most will have you paying too much using capital gains tables. This :: will be worth every penny u pay them to help. Don’t use a tax preparer use an accountant that knows this stuff .
Brushwacker
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Joined: Jan 2014
Posts: 10,586 Likes: 2
Lucky Bastage
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Lucky Bastage
Joined: Jan 2014
Posts: 10,586 Likes: 2 |
let's just say when I got it and it appraised for 100k and sell it 100k, is that no tax? From my understanding, If your basis is 100k and you don’t sell/gain over the 100k, there isn’t a taxable event. You’ve made no profit, as you’ve only depleted up to the basis. Taxable gain = Sales proceeds - basis In your example, there is zero gain. If the timber has been held for under a year, you would have been looking at ordinary income Tax IF there was a gain. You’ve gained zero, so there should nothing to tax. All of this needs to be documented properly though, the basis needs documented and a form T needs to be filed.
The fool tells me his reasons; the wise man persuades me with my own.
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Joined: Jul 2020
Posts: 10,379 Likes: 72
Booner
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Booner
Joined: Jul 2020
Posts: 10,379 Likes: 72 |
I guess that explains the 6% increase in my lease..........
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Joined: Dec 2002
Posts: 14,332 Likes: 65
Booner
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Booner
Joined: Dec 2002
Posts: 14,332 Likes: 65 |
If it appraises for 100,000 land and timber, you have to take the land off of the appraisal.
All of the value can’t be timber.
If the timber alone appraised for 100,000 and you sold it for 100,000, you’ve used up all of your basis but you’re good tax wise.
Then you still have the land cost basis.
Last edited by globe; 07/07/25 01:15 PM.
Everything woke turns to shucks
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Joined: Dec 2002
Posts: 14,332 Likes: 65
Booner
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Booner
Joined: Dec 2002
Posts: 14,332 Likes: 65 |
Land and timber are separate, that’s why you should have it appraised before you sell anything off of it.
Get the value of both.
Everything woke turns to shucks
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Joined: Jun 2021
Posts: 5,635 Likes: 34
Inter Loin Gourmet
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Inter Loin Gourmet
Joined: Jun 2021
Posts: 5,635 Likes: 34 |
My parents passed away 4 years ago and they had 403 acres. I have two brothers and a sister that didn't want any of it. We had land and timber appraised and I was able to only keep 91 acres with the pines being 50+ years old. After watching the bugs move slowly in them I am having it cut! It was sold by the ton and it's looking like it will come in real close to what just timber appraised for!
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Joined: Nov 2011
Posts: 22,603 Likes: 22
Freak of Nature
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Freak of Nature
Joined: Nov 2011
Posts: 22,603 Likes: 22 |
Yeah you won’t have any appreciable amount of growth in 4 years vs your basis.
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