COLUMBIA – How much are your trees worth?
A lot of Missouri woodland owners don’t know, according to Larry Godsey, an economist with the University of Missouri Center for Agroforestry. Without a good idea of what their assets are worth, landowners risk selling timber for too little—and paying too much in taxes.
As April 15 approaches, Godsey has been getting a lot of calls from woodland owners wondering if they can write off timber losses suffered last May when windstorms and tornadoes ripped through thousands of forested acres in the Missouri Ozarks.
“Many landowners don’t have a cost basis in their timber,” Godsey said. “If you have no basis, you have no deduction.”
Put simply, the cost basis, also known as the tax basis, is what you invested in an asset.
While many woodland owners probably have the cost basis for their entire property—which might include cropland and buildings as well as forest—they may not have established what portion of the original purchase price went to acquiring the timber.
“When you acquire the property, hire a consulting forester to estimate the volume and value of your timber,” he said. You can adjust your basis to reflect additional investments—including the forester’s fee.
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COLUMBIA – How much are your trees worth?
A lot of Missouri woodland owners don’t know, according to Larry Godsey, an economist with the University of Missouri Center for Agroforestry. Without a good idea of what their assets are worth, landowners risk selling timber for too little—and paying too much in taxes.
As April 15 approaches, Godsey has been getting a lot of calls from woodland owners wondering if they can write off timber losses suffered last May when windstorms and tornadoes ripped through thousands of forested acres in the Missouri Ozarks.
“Many landowners don’t have a cost basis in their timber,” Godsey said. “If you have no basis, you have no deduction.”
Put simply, the cost basis, also known as the tax basis, is what you invested in an asset.
While many woodland owners probably have the cost basis for their entire property—which might include cropland and buildings as well as forest—they may not have established what portion of the original purchase price went to acquiring the timber.
“When you acquire the property, hire a consulting forester to estimate the volume and value of your timber,” he said. You can adjust your basis to reflect additional investments—including the forester’s fee.
