Hinds Today

U.S. Senator Cindy Hyde-Smith (R-Miss.) has joined forces with bipartisan colleagues to support the Disaster Reforestation Act (S.217), a measure aimed at rectifying the unintended consequences of the federal tax code on forest landowners affected by natural disasters. The bill seeks to allow forest landowners to deduct the full value of timber destroyed during disaster events, just as the tax code currently allows for farmers and other agriculture crops.

Hyde-Smith, who introduced similar legislation in the previous Congress, emphasized the dire situation faced by small, family-owned forest businesses in Mississippi and across the nation. She stated, "So many of the private forest owners in Mississippi and across the country are really small, family-owned businesses that face financial ruin after floods, wildfires, and other disasters. We’ve needed this tax code change for a long time, and it is even more apparent now as Mississippi forest owners try to recover from the terrible drought and beetle infestations killing their trees. I hope this is the bill to get it done."

Under the current tax law, timber rendered unmarketable after a disaster is still considered a taxable asset. The Disaster Reforestation Act aims to establish a basis for determining the amount of the deduction in the case of the loss of uncut timber from fire, storm, other casualty, or theft. This amount may not be less than the excess of the appraised value of the uncut timber determined immediately prior to a natural disaster, over the salvage value of the timber.

Mississippi, with its more than 19 million forested acres, relies heavily on timber and forest products as a significant component of its agricultural economy. These industries generate over $3.37 billion in income and employ more than 67,000 workers in the state. Additionally, family owners hold an estimated one-third of forest land in the United States.

The Disaster Reforestation Act was introduced by U.S. Senators Bill Cassidy, M.D. (R-La.) and Raphael Warnock (D-Ga.) and has garnered support from other senators including Jon Ossoff (D-Ga.), Tommy Tuberville (R-Ala.), Katie Britt (R-Ala.), and John Kennedy (R-La.). The bill is currently pending in the Senate Finance Committee.

The passage of the Disaster Reforestation Act would provide much-needed relief to forest landowners affected by natural disasters, ensuring their ability to recover and rebuild their businesses.