Forestland assessor's questionnaire help (Joseph: 2013, house, purchase)

[jgsocal]

I recently purchased 20 acres of forestland in Josephine Co. I plan to live in an existing dwelling on the property. It is zoned FC, and can be, and preferred to be, managed for the purpose of growing and harvesting timber under this zoning.
My questions are about a letter I received from the tax assessor's department asking about how I intend to use the land, etc. I'm not sure how to answer some of them and was hoping someone here may have direct knowledge of this form and can guide me. I have tried to contact the assessors office but my work schedule is not lining up well with theirs, and truth be told I only remember this on the weekend when I have time to go through my desk. I'm just a bit cautious about answering something wrong and it turning into a bureaucratic headache.
Most of the questions are obvious, these are the ones I'm not certain of -
1. "What (if any) value was placed on timber as part of your purchase price?"
I made no special notes in the escrow instructions about timber value, nor did the seller, so I'm guessing this would be "N/A"
2. "Do you intend to hold the forestland for the predominant purpose of growing and harvesting marketable timber? Consider the forestland, not the residential portion of the property."
I intend to someday harvest the timber, but this is to be my home. So with the caveat that I'm not to consider the residential portion, I should answer "yes". I'm a bit concerned about this one, don't want to do it wrong.
3. "If there is a dwelling on the parcel, is it used in conjunction with management of the forestland?"
Well, there is a dwelling, but it's to be my primary residence, not a bunkhouse for loggers. But it will also be where I have my home office for anything related to my main business or property related expenses. I'm not sure how to answer that one.

I do intend to call the tax assessor's office on Monday morning, I will probably go to work at 5AM, get home at 5PM, and forget all about it in between, again. Sooner or later I will remember, so please don't everyone advise me to call them, I get that, I'm just looking to see if anyone else has had experience with this letter and how it turned out.

Thanks all!!

[oregonwoodsmoke]

I don't know about the value of your trees. You might pay a cruiser to come in and give you an estimate.

If you are someday going to cut trees, then the answer is yes. You aren't intending to burn them off and grow hay, are you?

If you live there, are you going to manage your forest? Watch over it, limb it up to increase the value? Call it in if there is a fire? If so, then the house is there, and you are living in it and you are keeping an eye on your trees, then the dwelling is used in conjunction with management of the forest.

Maybe, if you've purchased forest, you might want to do a little bit of looking into how to manage it. If it is properly managed, you will greatly reduce your fire risk. If you allow it to grow untended, then you have increased risk of forest fire.

[Larry Caldwell]

Originally Posted by jgsocal

I recently purchased 20 acres of forestland in Josephine Co. I plan to live in an existing dwelling on the property. It is zoned FC, and can be, and preferred to be, managed for the purpose of growing and harvesting timber under this zoning.
My questions are about a letter I received from the tax assessor's department asking about how I intend to use the land, etc. I'm not sure how to answer some of them and was hoping someone here may have direct knowledge of this form and can guide me. I have tried to contact the assessors office but my work schedule is not lining up well with theirs, and truth be told I only remember this on the weekend when I have time to go through my desk. I'm just a bit cautious about answering something wrong and it turning into a bureaucratic headache.
Most of the questions are obvious, these are the ones I'm not certain of -
1. "What (if any) value was placed on timber as part of your purchase price?"
I made no special notes in the escrow instructions about timber value, nor did the seller, so I'm guessing this would be "N/A"
2. "Do you intend to hold the forestland for the predominant purpose of growing and harvesting marketable timber? Consider the forestland, not the residential portion of the property."
I intend to someday harvest the timber, but this is to be my home. So with the caveat that I'm not to consider the residential portion, I should answer "yes". I'm a bit concerned about this one, don't want to do it wrong.
3. "If there is a dwelling on the parcel, is it used in conjunction with management of the forestland?"
Well, there is a dwelling, but it's to be my primary residence, not a bunkhouse for loggers. But it will also be where I have my home office for anything related to my main business or property related expenses. I'm not sure how to answer that one.

I do intend to call the tax assessor's office on Monday morning, I will probably go to work at 5AM, get home at 5PM, and forget all about it in between, again. Sooner or later I will remember, so please don't everyone advise me to call them, I get that, I'm just looking to see if anyone else has had experience with this letter and how it turned out.

Thanks all!!

1. If you did not estimate the value of the timber when you bought, you have already screwed up. The purchase price of the timber is not subject to capital gains tax when you harvest, but you have to establish the basis now. An appointment with an accountant would be a good idea.

2. If you want to put the land in timber deferral for property tax relief you will need to answer yes and file a timber management plan with the county assessor. The state forester can help you with this, and the county extension office is another good place to start, assuming Josephine County has an extension office any more.

3. Yes. You live there. It's your timber. QED.

BTW, I harvested about 20 acres in 2013. My share was $48,000, but only $33,000 was taxable thanks to a $15,000 basis that I established in 1994. You bought a wood factory. Run it like one.

[jgsocal]

Thanks for the input!
I talked to the assessor today and he was quite helpful. I did screw up not claiming a value, makes sense to me in hindsight. I found out in conversation with the assessor I have 10.7 acres of designated forest land, and a forest homesite of record.
I was leaning toward the correct answers, but it doesn't hurt to verify them.
Thanks again.

[ormari]

Originally Posted by jgsocal

Thanks for the input!
I talked to the assessor today and he was quite helpful. I did screw up not claiming a value, makes sense to me in hindsight. I found out in conversation with the assessor I have 10.7 acres of designated forest land, and a forest homesite of record.
I was leaning toward the correct answers, but it doesn't hurt to verify them.
Thanks again.

You might consider contacting a consulting forester in your area for some guidance on how to get things up and running. You can find one here, at the Association of Consulting Foresters webpage. You'd probably pick one with a 541 area code given the location of your property.