Biden Tax Plan Would Deter Sustainable Forest Management
The Biden Administration recently unveiled proposed changes they would like to make to U.S. tax laws, including several which would greatly affect forest landowners.
The policy changes having the greatest impact on forest landowners include taxing long-term capital gains as ordinary income for individuals with more than $1 million in taxable income, affecting those taxpayers who have a sharp increase in income in one year due to the sale of timber, along with the increase in the top capital gains rate from 23.8 to 43.4 percent; and the elimination of the step-up basis, imposing a capital gains tax on the appreciated assets as if they had been sold.
These proposed tax policy changes are expected to have an especially dramatic effect on family forest landowners and their ability to care for their forests in a sustainable manner and pass them on to future generations.
It is unclear how much support the president can win over for his plans, but landowners should be aware of these proposals and engage with their elected officials to educate them about the unique business of family forests.
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