logo
 

Go Back   HuntingNet.com Forums > General Hunting Forums > Wildlife Management / Food Plots

Wildlife Management / Food Plots This forum is about all wildlife management including deer, food plots, land management, predators etc.

Reply
 
Thread Tools
Old 09-08-2002, 05:58 PM   #1
 
Join Date: Feb 2003
Location: Erie PA USA
Posts: 113
Default Tax breaks?? Starting a tree farm?

I own 49 acres in Chautauqua county ny. My tax bill went from 300$ to $700 and that's only the school taxes. We only have 15' of road frontage on vacant land (35 wooded 14 field). Do you know of any tax breaks?????? Help??

What if i plant some trees and call it a tree farm?? Then i would have a farm/business? I belive i could write a portion of my taxes off and pruchases for the farm???
EDDIE

eddiee is offline   Reply With Quote
Old 09-08-2002, 06:44 PM   #2
Boone & Crockett
 
Join Date: Feb 2003
Location: Ponce de Leon Florida USA
Posts: 10,071
Default RE: Tax breaks?? Starting a tree farm?

You will probably have to consult a local CPA that is familiar with your tax rates on timbered land. I have some vacant timbered land in Alabama and the tax runs about a dollar per acre.

timbercruiser is offline   Reply With Quote
Old 09-09-2002, 01:44 PM   #3
 
Join Date: Feb 2003
Location: little rock ar USA
Posts: 6
Default RE: Tax breaks?? Starting a tree farm?

do you itemize on your federal tax return? if you do, then you should be able to deduct the taxes when you file your federal tax return. depending upon your tax rate, your tax benefit will vary. you may also want to check around as to what others that own land in that area are paying per acre, or dollar value of their property. as far as using the place as a tree farm, it would be more likely classified as a hobby farm. The determining test will be whether it is run for a profit motive, or not. your cpa and the irs is going to see if you have reported any income off of it. if i remember correctly you have to show a profit in one out of every 5 years, that is after depreciating any assets you might have tied to it, or expenses you may incur with the property, assuming you have it set up as a business. I do not know how your land is set up, so it is hard to make too many recommendations. my guess since you are on a hunting bulletin board you use it as a place to deer hunt, and that is its primary purpose. if you decide to plant the 14 acres in trees, what do you plan on doing with them, selling them as nursery stock, or waiting on them to produce enough timber to sell as logs. and what are your plans with the remaining 35 acres, are you planning on selling the timber off of it, or do you plan on leaving them alone. do you recieve any income off of it now, or do you get to call it yours and continue to pay taxes on it as long as you own it. not trying to deter you, just some stuff your accountant might ask about it. good luck, i know how you feel about the taxes, i don't like them either.
mac12 is offline   Reply With Quote
Old 09-09-2002, 03:23 PM   #4
 
Join Date: Feb 2003
Location: Erie PA USA
Posts: 113
Default RE: Tax breaks?? Starting a tree farm?

MAC,

I only hunt on the property and do not itemize. The land was logged to 12 inches just before I bought it. I do plan on logging it in about 20 years. Last year I planted 100 red oak trees and 250 blue spruce. I will likely sell the spruce trees as Christmas trees in 6 years or so. I do not plan on selling the red oak trees (I will likely be dead when they are ready for harvest). My thoughts are to plant enough trees to call it a business/tree farm. I don't know if it can be done?? Any thoughts?? suggestions?? Just looking for some input before I call a cpa.

Thanks
eddie
eddiee is offline   Reply With Quote
Old 09-09-2002, 06:20 PM   #5
 
Join Date: Feb 2003
Location: Delaware Cty New York USA
Posts: 56
Default RE: Tax breaks?? Starting a tree farm?

Eddie - just a couple of points. If you plan on calling it a tree farm, then you will need to plant a crop each year, + or -,in order to have a rolling supply. Otherwise, once you cut the trees you no longer have a product. Look at selling firewood. Also flat rock from the fields. Like I said, just a few suggestions. One more thing, I'm pretty sure that you need to show a profit 2 out of 5 years.

Charlieb
__________________
Charlieb
charlieb is offline   Reply With Quote
Old 09-10-2002, 09:07 AM   #6
 
Join Date: Feb 2003
Location: Towanda PA USA
Posts: 60
Default RE: Tax breaks?? Starting a tree farm?

Ediee,

My BS in Accounting tells me that you need not make a profit, you just have to have a profit motive in the eyes of the IRS. You cannot use a hobby as a write off, according to the IRS. Check out this site for mor info and please contact your local CPA.

http://taxes.about.com/library/weekly/aa061200a.htm

"Take a Kid hunting today!"
Cleeby is offline   Reply With Quote
Old 09-10-2002, 11:22 AM   #7
 
Join Date: Feb 2003
Location: little rock ar USA
Posts: 6
Default RE: Tax breaks?? Starting a tree farm?

might i suggest you contact someone like arthur anderson, i understand they have some good tax strategies. who knows, you could show all your future earnings this year, go public with it, sell stock, use the proceeds from the stock to buy more land, set up a trust that gets a good enough rate of return that pays for all the taxes and expenses of the new property, have them do your taxes showing you made a loss there and not owe any income tax, get a tax refund, show stock holder an income statement showing how many billions your farm made, stock goes up, you dump yours, buy more land, and have them come in and audit your farm and sign off that everything was correctly reported to shareholders. retire to the ponderosa. oops sorry, i just woke up, seems like someone else already tried that.
mac12 is offline   Reply With Quote
Old 09-10-2002, 07:29 PM   #8
Nontypical Buck
 
Join Date: Feb 2003
Location: Oakland OR USA
Posts: 2,929
Default RE: Tax breaks?? Starting a tree farm?

Cleeby is right about the profit thing ,you don't have to show a profit every year especially on a tree farm that take 50 years for the trees to mature .They might also have a agricultural program for your property taxes which can lower them quite a bit as long as you keep running it as a farm .Downside of that is that you must continue or you could have to make the taxes up at a later date because you shut down .
halcon is offline   Reply With Quote
Old 09-11-2002, 06:09 PM   #9
 
Join Date: Feb 2003
Location: Towanda PA USA
Posts: 60
Default RE: Tax breaks?? Starting a tree farm?

Hey Mac12,

Sounds like you might have had a litte Enron or Worldcom. Sorry if you did , I know its not a laughing matter as i did also. Boy did you hit it on the head though, had you gone in several years ago to those companies with that strategy you could have been a very rich CEO who should not be able to sleep at night, but probably does not have a problem with guilt.
Cleeby is offline   Reply With Quote
 
 
Reply


Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Tree Farm Program??? Dbl Beard Wildlife Management / Food Plots 14 01-09-2007 12:35 PM
Spring Black Bear Hunting on Kapowsin Tree Farm Tyson71485 West 19 04-29-2005 04:01 PM
starting a tree stand business deerhunter1224 Whitetail Deer Hunting 5 05-18-2003 11:30 AM
military tax breaks =archery tax breaks soarkrebel Politics 3 03-06-2003 11:17 AM

 

All times are GMT -8. The time now is 12:50 AM.