Prior to October 23, 2004, under IRC Section 194, up
to $10,000 per year of qualifying reforestation costs
could be amortized over 84 months.
In addition, prior to October 23, 2004, IRC Section 48
permitted a 10 percent tax credit on up to $10,000
per year of qualifying reforestation costs.
All taxpayers except trusts were eligible for both
Costs exceeding $10,000 per year remained in the
depletion account until the trees were sold or
otherwise disposed of.
Effective October 23, 2004 all taxpayers except
trusts can deduct outright (expense) up to $10,000
per year of qualifying reforestation costs with
respect to each eligible timber property. The term
"eligible timber property" is addressed in the
instructions on the current edition of IRS Form T.
Eligible reforestation costs exceeding $10,000 per
year per eligible timber property, without limit, can
be amortized over 84 months. Trusts are eligible for
this provision, including amortization of the first