Forestry Update 4-12

By Gary Allen Burns

For federal income tax purposes, “material participation” is required for certain timber management benefits.

You must meet at least one of the following six standards:

1. 500 hours of participation

2. Sole participation for the tax year

3. More than 100 hours and at least as much as any other person for the year

4. Participation for any five or the prior 10 tax years

5. Material participation along with 100 hours of work

6. At least 500 hours total in several business activities and at least 100 hours in the timber activity