Basis for capital gains tax

[dmccarty]

Foresters can determine the basis of the timber when you inherited the land. If you had a timber agent/forester as part of the timber sale they should have provided you the timber basis. You should be able to get a timber agent/forester to provide the basis for you even after the timber has been cut.

In NC, the forestry department will create a timber plan for land owners but it can take some time. They MIGHT also provide a basis for timber that was inherited. Twould not hurt to asked you state agency.

When we timbered our place, I had a tough time finding a CPA that knew as much as I did about timber. :shocked: I had done my home work and read quite a bit, the NC Extension office was a huge help, but I wanted a CPA to verify my view on the taxes. In the end I just submitted the forms my self since I could not find a CPA. Worked out fine. :thumbsup:

Anyway, ask the state forester, local paid timber agent/forester and the state extension office if there is one on how to calculate the timber basis.

Later,
Dan

 

[JD 4520]

I don’t disagree with Dan’s suggestions above, that said, keep in mind this is 9 acres of clearing and thus a pretty minor transaction. Not necessary to engage all of these outside consultants unless you want to spend your profits on opinions. It shouldn’t be difficult to figure out your net profit and pay the piper it’s share. Be sure to only pay the 20% long term capital gains tax and not the additional 3.8% Obama tax as you are directly involved in the business.

 

[dmccarty]

I don稚 disagree with Dan痴 suggestions above, that said, keep in mind this is 9 acres of clearing and thus a pretty minor transaction. Not necessary to engage all of these outside consultants unless you want to spend your profits on opinions. It shouldn稚 be difficult to figure out your net profit and pay the piper it痴 share. Be sure to only pay the 20% long term capital gains tax and not the additional 3.8% Obama tax as you are directly involved in the business.

Only one of my suggestions would cost money. The one that would cost money should not cost very much.

Later,
Dan

 

[DrRod]

Thank you all for your replies. I always learn a lot from you guys.