Instructions For Form T (Timber) (Rev. December 2013) - Forest Activities Schedule (Page 3 of 4) in pdf

Part III. Profit or Loss From

spraying, and thinning) applied to a

block) for which depletion is allowed

timber stand regardless of age.

or for casualty losses (that is, lines 13

Land and Timber Sales

and 14 of Part II) or other purposes.

Line 4a. Reforestation

Complete this part to report all

The qualified timber property account

dispositions of timber, timber-cutting

Expenses

must be maintained until after the

contracts, or forest land during the tax

By entering an amount on this line,

timber is disposed of through sale,

year (whether taxable or not). Do not

you are indicating that you have

harvest, or other transaction.

report dispositions by gift or

elected to deduct qualifying

For each qualified timber property

distributions made by an estate or to a

reforestation expenses that were paid

(QTP), keep detailed information to

beneficiary.

or incurred after October 22, 2004, for

support reforestation costs, showing

each qualified timber property under

Report each sale involving total

treatments and dates of application.

section 194(b). You must complete

consideration of $10,000 or more.

Each qualified timber property is

line 1 of Part IV listing the following:

You may combine sales of less than

required to have a unique stand

The account, block, tract, area or

$10,000 for each timber or land

identifier. Retain this information for

stand identification number for each

account and omit lines 2 and 3 for

your records. Report expenses such

qualified timber property (QTP);

each combined small sale.

as supplies, labor, overhead,

The kind of activity (burning,

transportation, tools, and depreciation

Outright sales of timber. Certain

chopping, spraying, planting, seeding,

on equipment.

rules under section 631(b) allow the

thinning, pruning, fertilizing, etc.);

landowner to treat outright sales of

Site preparation. Report all

The number of acres treated; and

timber as capital gain. The rules

expenses incurred during the tax year

The total expenditures.

extending capital gains treatment to

for preparing the land for planting or

outright sales of timber are similar to

The aggregate amount of

seeding (including natural seeding).

certain disposals of timber under a

Include expenses for clearing the land

reforestation expenses which can be

contract with a retained economic

of brush and culling trees by burning,

claimed on line 4a for any tax year

interest. However, for outright sales,

disking, chopping, shearing and

cannot exceed $10,000 ($5,000 if

the date of disposal is not deemed to

piling, spraying with herbicides, or

your filing status is married filing

be the date timber is cut because the

other measures taken to aid

separately) for each qualified timber

owner may elect to treat the payment

successful site reforestation. Report

property for any tax year. The

date as the date of disposal. For more

this information separately for each

remaining costs (line 4b) can be

information, see section 631(b) and

amortized over an 84-month period

unique stand identifier, depletion

Pub. 544.

using the half-year convention under

account, block, tract, or operating

section 194(a). For more information

area tributary to a mill or mill complex.

Timbercutting contract. For a sale

Report contract work separately from

on reforestation costs, see Pub. 535.

or lease of timber-cutting rights on a

your employees' work.

pay-as-cut basis, that will be paid for

If you do not elect to deduct

at intervals during the cutting period

Planting or seeding. Report the

reforestation expenses under section

according to the number of units cut,

expenses you incurred during the tax

194(b), all reforestation expenses will

complete lines 4, 7, and 8, only for

year for planting seedlings or sowing

be capitalized in a deferred timber

accounts that must be reported on

seed to reforest the land. Report this

depletion account.

your current year income tax return.

information separately for each

Reforestation expenses are direct

unique stand identifier, depletion

Instead of completing lines 5a, 5b,

costs incurred for reforestation by

account, block, tract, or operating

and 6, briefly state the provisions of

planting or artificial or natural seeding.

area tributary to a mill or mill complex.

the sale or lease agreement, including

This includes costs for the preparation

Report contract work separately from

the number of years from the effective

of the site, of seeds or seedlings, and

your employees' work.

date to the expiration date, annual

for labor and tools, including

minimum cut or payment, and the

Other silvicultural activities.

depreciation of equipment such as

payment rates for the different kinds

Report all expenditures that must be

tractors, trucks, tree planters, and

of timber and forest products. You

capitalized and items that you elect to

similar machines used in planting or

may combine small sales or leases of

capitalize. Also, list on a separate

seeding.

timber-cutting rights on a pay-as-cut

attachment items that are treated as

basis that were completed within the

Reimbursements under govern

current deductions (including, but not

tax year. Follow the format of lines 1

mental reforestation costsharing

limited to, weed control, pruning,

through 8 on additional sheets if

programs. If you have been

fertilization, thinning, insect and

necessary.

reimbursed under any governmental

disease control). Report this

reforestation cost-sharing program,

information separately for each

Part IV. Reforestation and

you may not claim these expenses

unique stand identifier, depletion

Timber Stand Activities

unless the amount reimbursed has

account, block, tract, or operating

been included in your income.

area tributary to a mill or mill complex.

Summarize your expenditures for

Report contract work separately from

reforestation and timber stand

Qualified timber property (QTP).

your employees' work.

activities during the tax year. Timber

Any qualified timber property subject

stand activities include all silvicultural

to section 194(b) may not be

For more information, see section

prescriptions (such as burning,

combined with any other qualified

194 and Regulations section 1.194-3.

timber property account (depletion

Instructions For Form T (Timber) (Rev. December 2013) - Forest Activities Schedule Page 3

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