Amortization and Expensing of Reforestation Expenditures


Public Lands

Subsidy Type

Tax Expenditure

Committees of Jurisdiction

House Committee on Ways and Means, Senate Finance Committee

$160 FY 23 Budget Score (in mil.)
$1,600 FY 23-32 Budget Score (in mil.)

The amortization and expensing of reforestation expenditures provision of the tax code allows for the deduction of up to $10,000 per year ($5,000 for married individuals filing separately from their spouses; no limit for trusts) of qualifying reforestation costs paid or incurred after Oct. 22, 2004, for each qualified timber property. The remaining costs in excess of the deduction can be amortized over an 84-month period. There is no limit on the amount of the amortization deduction.

Reforestation costs are the direct costs of planting or seeding for forestation or reforestation. Qualifying costs include site preparation, seedlings, labor, tools, and depreciation on equipment used in planting and seeding. Qualified timber property is property in the United States that: contains trees in significant commercial quantities; is held for growing and cutting timber used in the commercial production of timber products; and consists of at least one acre planted with tree seedlings using a normal forestation or reforestation method.

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