Can any of you tree people provide the formula to calculate the value of dead trees for tax deduction?

tia

Wait, we can claim lost trees as a loss for tax purposes?

I lost an enormous pine tree during Ike. I wonder if I should amend my tax return for that year.

Forestry losses IIRC

I have a huge oak that hasn't handles the drought at all and may be done for. This thread is very relevant to my interests.

Spoke with my banker lady and she said she heard about this on the Neal Sperry show. I called a former customer that consulted with Neal on various issues and he did confirm. He just wasn't sure about the formula. Neal recomended bringing in an Arborhist to determine the value of the loss. I say screw that I can use a calculator. Will get with my CPA for answers.

long time ago, with any casualty losses like this, we took the value of the property before the event and the value of the property after the event. If there were no other factors, then the difference is the casualty loss.

I don't know that there is a formula by an tree man, bush man, banker for a dead tree-if so, great.

quote:

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Some casualty or theft losses are not tax deductible on your IRS tax return, such as the ones below:


Accidental loss of a ring from your finger;
A fire set on purpose by the owner;
A well that goes dry;
Carpet beetle damage;
China plates broken by a pet;
Damages to property caused by excavations on adjoining property;
Damages for personal injuries or property damage to others caused by your negligence;
Damage to a crop caused by plant diseases, insects, or fungi;
Damage from rust or corroding of the understructure of a house;
Damage to property from a government construction project;
Damages to property from drought in an area where a dry spell is normal and usual;
Dry rot;
Engine damage caused by failing to use anti-freeze;
Expenses to move to, and rent for, temporary quarters;
Eye glasses or a watch dropped on the ground;
Injuries from tripping over a wire;
Legal expenses for defending a suit regarding your negligent operation of your personal automobile;
Legal expenses to recover personal property wrongfully seized by the police;
Loss of a valuable dog that strayed;
Loss of a private liquor stock in an improper police seizure;
Loss of a contingent interest in property because of the unexpected death of a child;
Loss of jointly held property taken by the other joint tenant;
Loss of luggage aboard a ship;
Loss of personal property while in storage or transit;
Losses from natural phenomena;
Loss of trees from diseases;
Money paid to a public library for a book you damaged;
Moth damage;
Sudden drop in the value of securities;
Termite damage;
Temporary fluctuations in value

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Texas is dry in the summer, but this is an exceptional drought. Looks like there may be a lot of stipulations to claim trees as casualties.

[This message has been edited by Max06 (edited 8/18/2011 9:04p).]

That list is RIDICULOUS!

Yes it is! I'm on my crackberry or else I'd do a legitimate search for it.

Posting so I can remember to show this to my folks.

You would have to normally have a taxed income from the trees you lost. You cant just say, my trees died give me a tax break. It is going to be like I practice silviculture on my 500 acres and I lost 10% of my trees I'm entitled to a tax break.

quote:

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Injuries from tripping over a wire;

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But tripping over anything else is okay?

Trees are part of your real property, which is taxed. It's a deduction similar to storm losses, etc.

All of those things listed are NOT tax deductibule.

I'm just speaking from experience; family lost lots of oak trees on property due to Ike. But the property's Ag exemption is from pine trees, well we lost like 5, we didn't get jack (0) for the oak trees and not much for the pines ("fair" market price).

[This message has been edited by OnlyForNow (edited 8/19/2011 7:42a).]

quote:

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All of those things listed are NOT tax deductibule.

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Crap....now I'm going to have to redo my last five years of taxes.

#1 That list is absolutely ridiculous

#2 The loss of trees due to drought might not be directly tax deductable, but trees, especially large desirable species, can significantly increase the value of a property. If the trees are killed, they can significantly reduce the value. I may be wrong, but I imagine you would be able to argue to get the value of the property lowered and therefore owe less in property taxes, if you're concern is how much you will end up paying tax wise.

G.Ag. you'd have to have an aprisal pre-tree damage and post tree daamge to assess the actual hit the property value took from the loss of trees.

I fail to see how losing 20 trees to drought is going to decrease land value at all much less significantly..especially if its wooded already.

In fact, for some, Id consider it an improvement. Lol.

Jed, he isn't wrong/right really.

You might find a person willing to pay an extra 1200/acre if the majorty of the trees were mature 20-60 year old and older oaks, elms, etc. Likewise you might find someone who is willing to pay you 2000/acre extra if you get rid of those damn trees.

The quick and dirty on this for your personal residences is:
- It is possible to claim a casualty loss for dead trees as result of drought

- You must know the Fair Market Value of your property immediately before and after (tough one to prove)

- The loss is limited to the amount left after subtracting 10% of your income (AGI)

For example, you make $100k a year and you claim a $15k decrease in property value because your tree died. You would only get to take $5k of that $15k as a loss.


For income producing/business property it similar limitations but there are no limitations on the loss. So if it's a working ranch, rental home, etc., you may be able to claim more.


All this being said, if you are seriously considering this, see a CPA.

agree w/sooner. see a CPA and I would add one with access to current IRS rules, regs & court decisions. Used to be that all those listed as not allowed are to prevent abuse by taking deduct for any normal loss of crops or trees. Must be more current IRS guide since all the hurricanes and floods the last few years. Why I retired.l

check with Scott Burgess, CPA. www.SBurgessCPA.com. He is a sponsor on the business and investing forum. Has a website with good information.