Title: Forest Recovery Act
Policy area: Taxation

Summary:
Forest Recovery Act
This bill modifies the tax deduction for casualty losses to establish special rules for losses of uncut timber.
In the case of the loss of uncut timber from fire, storm, other casualty, or theft, the basis used for determining the amount of the deduction may not be less than the excess of (1) the fair market value of the uncut timber determined immediately before the loss was sustained, over (2) the salvage value of the timber.
The rule applies only if (1) the timber was held for the purpose of being cut and sold, and (2) the uncut timber subject to the loss is reforested within five years of the loss.
The bill also exempts casualty losses from uncut timber from the rule restricting the deduction for personal casualty losses to losses attributable to a federally declared disaster.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 1687 Introduced in Senate (IS)]

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116th CONGRESS
  1st Session
                                S. 1687

 To amend the Internal Revenue Code of 1986 to provide a special rule 
              for certain casualty losses of uncut timber.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                 May 23 (legislative day, May 22), 2019

 Mrs. Hyde-Smith (for herself, Mr. Wicker, Mr. Rubio, and Mr. Cotton) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to provide a special rule 
              for certain casualty losses of uncut timber.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Forest Recovery Act''.

SEC. 2. CASUALTY LOSSES OF UNCUT TIMBER.

    (a) In General.--Section 165(b) of the Internal Revenue Code of 
1986 is amended--
            (1) by striking ``For purposes of subsection (a)'' and 
        inserting the following:
            ``(1) In general.--For purposes of subsection (a)''; and
            (2) by adding at the end the following new paragraph:
            ``(2) Special rule for casualty loss of uncut timber.--
                    ``(A) In general.--In the case of the loss of any 
                uncut timber from fire, storm, or other casualty, or 
                from theft, the basis for determining the amount of the 
                deduction for such loss (as otherwise determined under 
                paragraph (1)) shall not be less than the excess of--
                            ``(i) the fair market value of such uncut 
                        timber determined immediately before such loss 
                        was sustained, over
                            ``(ii) the salvage value of such timber.
                    ``(B) Exclusion of timber not held for sale.--
                Subparagraph (A) shall not apply to any timber unless 
                such timber is held for the purpose of being cut and 
                sold.
                    ``(C) Inclusion of pre-merchantable timber.--For 
                purposes of this paragraph, the term `uncut timber' 
                shall not fail to include pre-merchantable timber.
                    ``(D) Reforestation requirement.--Subparagraph (A) 
                shall not apply unless the uncut timber subject to the 
                loss is reforested (with hardwoods, softwoods, or any 
                combination thereof) by planting, seeding, or 
                appropriate site preparation, not later than the close 
                of the 5-year period beginning on the date of such 
                loss.''.
    (b) Exception To Repeal of Personal Casualty Losses.--Section 
165(h)(5)(A) is amended by inserting ``or a loss of uncut timber 
(within the meaning of subsection (b)(2)) to which subsection (b)(2)(A) 
applies'' after ``Federally declared disaster (as defined in subsection 
(i)(5))''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
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