Please note that this post contains affiliate links and any sales made through such links will reward MageeNews.com a small commission – at no extra cost to you.
HYDE-SMITH INTRODUCES BILL TO HELP PRIVATE FOREST OWNERS RECOVER FROM DISASTERS
A Third of Forest Land in the U.S. is Held by Family Landowners, Who Find Limited Options Following Loss of Timber to Natural Disasters
WASHINGTON, D.C. – With one-third of forest land in the United States held by family owners who currently have little recourse for relief following floods, wildfires, and other disasters, U.S. Senator Cindy Hyde-Smith (R-Miss.) has introduced legislation to amend the tax code to support recovery work. The measure is cosponsored by Senators Roger Wicker (R-Miss.), Tom Cotton (R-Ark.), and Marco Rubio (R-Fla.).
The Forest Recovery Act (S.1687) would amend the U.S. tax code to establish a special rule for losses of uncut timber following natural disasters. Providing a tax deduction for casualty losses would not only help landowners recover, but also encourage investment in reforesting damaged acres.
“Not allowing these timber interests, many of whom are family-owned small business operations, to recover their losses doesn’t help anyone—not them, the local economy, or the environment,” Hyde-Smith said. “My bill would create an opportunity to make this right.”
“Mississippi’s millions of acres of forests are our state’s second largest agricultural product by value but are not eligible for tax relief in case of disaster,” Wicker said. “This proposal would provide landowners much-needed relief in the event of a catastrophe and encourage the return of this land to active production.”
“More than half of Arkansas is forestland that supports thousands of jobs and contributes to the state’s natural beauty. This bill will benefit Arkansas’s many family forest landowners and encourage the rehabilitation of our forests after natural disasters,”Cotton said.
“Hurricane Michael devastated Northwest Florida’s timber industry,” Rubio said. “I am glad to join my colleagues in proposing legislation to ensure that future timber losses due to natural disasters, like Hurricane Michael, will receive needed tax relief.”
“The nation’s family forest owners are grateful for the support of Senator Hyde-Smith in introducing legislation that can help them better care for their forests today and in the future,” said Tom Martin, President and CEO of the American Forest Foundation.
“There are more than 20 million families and individuals who own and care for the largest portion of U.S. forests, providing all Americans with important resources such as wildlife habitat, clean air and water, and wood for homes and products we use every day. When disasters like hurricanes and wildfires strike, family forest owners do not have access to affordable insurance like most farmers, yet face similar significant economic losses. We applaud Senator Hyde-Smith for addressing these important issues for family forest owners with the introduction of the Forest Recovery Act,” Martin said.
The legislation would adjust current tax law, which restricts casualty loss deductions to losses incurred in federally-declared disaster areas. Even when wildfires or floods do not result in a formal disaster designation, federal crop insurance coverage is unavailable for forest lands, and there are no affordable private insurance products.
Specifically, the Forest Recovery Act would:
- Modify the tax deduction for casualty losses to establish special rules for losses of uncut timber;
- Establish that basis used for determining the amount of the deduction in cases of uncut timber losses from fire, storm, other casualty, or theft may not be less than the excess of the fair market value of the uncut timber determined immediately before the loss was sustained over the salvage value of the timber;
- Apply the special rule only if (1) the timber was held for the purpose of being cut and sold and (2) the uncut timber subject to the loss is reforested within five years of the loss; and
- Exempt casualty losses from uncut timber from the rule restricting the deduction for personal casualty losses to losses attributable to a federally declared disaster.
