I sold some trees in February and will need to do my taxes properly this time. Last time I just listed the money as ordinary income and screwed myself -- it should have been long term capital gains and I pay zero at my income level.
This time I'll have logging expenses, I'll subtract some of my basis from the income because the trees were here when I bought the property, and I had to pay the logger quite a bit to widen my driveway so the log truck would fit over and off my bridge. I think properly I need to capitalize that expense, as it's a permanent improvement to my roadway.
I'm in Oregon but I didn't sell enough trees to trigger the state timber severance taxes.
I'm sorry if it sounds like I think I know what I'm doing, because I don't and I'm open to any discussion on the topic, especially from others who sell timber. I don't remember reading about anybody else on the forum with forest land so I may be out of luck. I'm acquainted with the web site timbertax.org which has lots of stuff on the federal tax level. I know where to find a form T-1 to file though I've never filled one out. So: any tips?
