U.S. Sen. Roger Wicker (R-MS) recently introduced the Forest Recovery Act, which would provide a tax cut to American landowners for losses incurred when natural disasters destroy their uncut timber.
Sen. Wicker on May 23 introduced S. 1687 with bill sponsor U.S. Sen. Cindy Hyde-Smith (R-MS) to amend the tax code and establish a special rule that would provide a tax deduction for casualty losses to help landowners recover and to encourage investment in reforesting, according to a summary provided by Sen. Wicker’s office.
“Mississippi’s millions of acres of forests are our state’s second largest agricultural product by value but are not eligible for tax relief in case of disaster,” Sen. Wicker said. “This proposal would provide landowners much-needed relief in the event of a catastrophe and encourage the return of this land to active production.”
If enacted, S. 1687 also would establish a process for determining the tax deduction amount.
“In the case of the loss of any uncut timber from fire, storm, or other casualty, or from theft, the basis for determining the amount of the deduction for such loss … shall not be less than the excess of the fair market value of such uncut timber determined immediately before such loss was sustained, [nor] over the salvage value of such timber,” according to the text of the bill.
The proposed special rule established under the proposal would be applied only if the timber was held for the purpose of being cut and sold and when the uncut timber would be reforested within five years of the loss.
S. 1687 has been referred to the U.S. Senate Finance Committee for consideration.