Owning timberland can be a very lucrative and rewarding investment for those focused on the long term. Adding this investment to an existing portfolio of stocks, bonds, CD’s, or other assets can improve diversification and potentially the return. Unlike paper assets, timberland owners can enjoy recreational activities such as hunting, hiking, fishing, etc. on their property. Additionally, timberland owners have a number of tax advantaged options in the treatment of timber income, management expenses, and estate issues. Henderson & Associates, Inc. offers our clients the following land investment consulting services:
Regardless of your reasons for purchasing timberland you should know the market value of the property prior to entering into a purchase agreement. Merchantable timber, pre-merchantable timber, and improvements all contribute to the underlying value of the “bare” land. Having this information improves your chances to acquire a tract for a fair price. Our firm possesses the expertise to accurately value the land, timber, and other assets on the property you wish to acquire and can assist you through the entire process.
“Like-kind” exchanges involve the liquidation of a real estate asset and acquisition of another “like-kind” property as a replacement for the original property owned. This option permits the seller of real estate to shelter a capital gain from taxation provided certain legal requirements are followed. Henderson & Associates, Inc. has assisted many clients with their 1031 exchanges and are prepared to assist you with this tax-saving option.
Although the qualified exemption for assets in an estate has increased in recent years, those forest landowners with significant land holdings still must develop an estate plan which will facilitate the transfer of ownership to their heirs with minimum estate tax liability. Our firm can coordinate with your estate attorney and tax accountant to ensure they have the required property information and valuation to formulate your estate plan.
In order to maximize the return from a forest investment, an investor must be familiar with the many favorable tax options associated with timberland ownership. Taking advantage of these deductions begins when you acquire your property, continues throughout your ownership, and terminates upon liquidation of your tract. We are prepared to work with you and your tax accountant to ensure all tax options pertaining to the sale or management of your timber are considered.
To learn more about forest investment considerations and land management services, contact Henderson & Associates, Inc. in Newberry South Carolina. We have been in business for more than 35 years and have helped many investors purchase and sell timberland profitably.