Timber Management Plan

If you own at least 5 acres with trees in Washington State your property may be eligible to enroll in the Current Use Program which could reduce your yearly tax bill significantly. The program is intended to give a tax break to those who grow trees for harvest, much like the tax break offered to those who produce agricultural products. The portion of your property (approx. 1 acre) that your home sits on would be taxed at the “highest and best use” rate, while the balance of your property, (provided it meets certain criteria) could be taxed at a much lesser rate.

If you are purchasing forested property that is already enrolled in this program, you can apply for a continuance of this program so long as you make application and provide a timber management plan prior to closing. Some counties allow new land owners as many as 60 days after closing to complete an acceptable management plan.  Such plans are usually written by an Accredited Forester with a cost to the applicant between $600 -$1,500. The plan includes descriptions of the current tree growth along with mapping of forested areas and wetlands, as well as identifying soil types and a plan of action for future stewardship.

For properties with 20 acres or more, there is a cost sharing plan available from the Department of Natural Resources that reduces the cost of initiating the plan. Since each plan is specific to each owner, the cost to create a new timber management plan is usually borne by the purchaser, even though it saves the seller the cost of paying compensating taxes at closing. Every time a property sells, it triggers an automatic removal from this tax classification, unless the new buyer is willing to sign a continuance and meet the requirements. Though there seems to be very little monitoring or enforcement of a timber management plan, the county could potentially request compliance to the plan or remove it from the program and levy compensating taxes if the landowner has not met requirements.

The property must meet the standard of at least 150 viable trees (at least 4 feet tall) of varieties that are marketable for lumber. The intention must be to eventually harvest the timber as you would an agricultural crop. Each individual county provides lists of foresters who are eligible to write such plans. Contact your real estate professional for more information on this topic!