Home Columnist FORESTRY UPDATE by Gary Allen Burns 3-23

FORESTRY UPDATE by Gary Allen Burns 3-23


Reforestation expenses can often qualify for incentive payments from government programs. The taxpayer has a choice of including the payments in income and paying taxes as required, or the cost share can be excluded from the income. The excluded payments cannot be deducted from the taxable income.

It is usually best to exclude cost-share since the tax cost of inclusion may increase the adjusted gross income with exposure to expense thresholds, alternative minimum tax liability and higher marginal tax rates for both ordinary income tax and capital gains.