2023 Oregon Revised Statutes › Volume : 08 - Revenue and Taxation › Chapter 315 - Personal and Corporate Income or Excise Tax Credits › Section 315.124 - Small forestland owner using standard practice harvest restrictions; rules.

(1) As used in ORS 315.124 to 315.132:
(a) "Common ownership" means direct ownership by one or more individuals or ownership by a corporation, partnership, association or other entity in which an individual owns a significant interest.
(b) "Dry channel area" means that area between the inside edge of the small forest owner minimum option and the edge of the dry stream channel that:
(A) Is within a surveyed dry channel portion of a small nonfish perennial stream in Western Oregon that under the small forest owner minimum option is a required no-harvest buffer;
(B) Does not flow water year-round; and
(C) Is 100 feet or more in length.
(c) "Forest conservation area" means a riparian forestland area that is not harvested, that is adjacent to a harvested riparian area and that is the excess riparian area allowed for harvest under the small forest owner minimum option beyond that allowed under the standard practice harvest restrictions, and any adjacent dry channel area.
(d) "Forestland" has the meaning given that term in ORS 527.620.
(e) "Professional forester" means a person that is engaged in the business of appraising or valuing timber or forestland as described in ORS 674.100.
(f) "Small forestland owner" means a person that owns or holds common ownership in fewer than 5,000 acres of forestland.
(g) "Small forest owner minimum option" means the option to harvest timber allowed to a small forestland owner under rules adopted under the Oregon Forest Practices Act.
(h) "Standard practice harvest restrictions" means the harvest restrictions applicable to large forestland owners under the Oregon Forest Practices Act.
(i) "Stumpage value" means the value of standing timber based on the value that would be received for the timber if harvested and delivered to a mill, minus the cost of harvest and delivery to the mill.
(j) "Timber harvest" means a harvest type 1, harvest type 2 or harvest type 3, as those terms are defined in ORS 527.620.
(k) "Western Oregon" means that area west of the crest of the Cascade Mountains.
(2)(a) A credit against taxes that are otherwise due under ORS chapter 316 or, if the taxpayer is a corporation, under ORS chapter 317 or 318 is allowed to a taxpayer that is a small forestland owner that is eligible to conduct a timber harvest using a small forest owner minimum option and elects to use standard practice harvest restrictions instead. The credit shall be allowed for the tax year in which the timber harvest is completed.
(b) A credit under this section may not be transferred to a successor forestland owner.
(3) In order to be eligible for a credit under this section, a small forestland owner must:
(a) Have harvested not more than two million board feet of merchantable forest products from forestland in this state owned by the small forestland owner, as averaged over the three years immediately preceding the date of filing a notification of operation as described in ORS 315.126;
(b) Conduct a timber harvest in an area that is:
(A) Adjacent to a riparian area subject to the Oregon Forest Practices Act; and
(B) Equal in size to or larger than that portion of the forest conservation area that the small forestland owner elects not to harvest and upon which the small forestland owner claims the credit; and
(c) Abide by the standard practice harvest restrictions, which shall remain in effect for the forest conservation area for which the small forestland owner claims the credit for 50 years beginning with the date on which the certification is issued under ORS 315.126.
(4) The amount of the credit allowed under this section shall be based on the stumpage value of timber within the forest conservation area and shall be calculated as provided in ORS 315.128.
(5) Prior to claiming the credit allowed under this section, a small forestland owner is required to receive written certification of eligibility from the State Forestry Department, as provided in ORS 315.126.
(6) Upon the death of a small forestland owner that holds a certification under ORS 315.126, and to the extent that any amount of credit remains, the credit allowed under this section:
(a) May be used by the executor of the small forestland owner’s estate:
(A) As a credit against taxes imposed under ORS chapter 316, 317 or 318; and
(B) As provided in ORS 118.152, as a credit against estate tax imposed under ORS chapter 118 on the estate of the small forestland owner; and
(b) May be used, to the extent remaining after application of paragraph (a) of this subsection, by the heirs or devisees of the small forestland owner as a credit against the taxes imposed under ORS chapter 316, 317 or 318.
(7) The credit allowed under this section may not exceed the tax liability of the taxpayer for the tax year.
(8) A forest conservation area for which a credit is allowed under this section:
(a) May not be disqualified from eligibility for special assessment as forestland under ORS 321.257 to 321.390 or 321.805 to 321.855 or from qualification for small tract forestland assessment under 321.700 to 321.754 solely due to the use of the credit allowed under this section.
(b) Shall remain eligible for the deferral allowed under ORS 308A.119, if otherwise eligible.
(c) Shall be classified as described in ORS 321.210 as land class FX.
(9) Any tax credit otherwise allowable under this section that is not used by the taxpayer in a particular tax year may be carried forward and offset against the taxpayer’s tax liability in any succeeding tax year thereafter, and may be carried forward to nonconsecutive tax years.
(10) A nonresident shall be allowed the credit under this section. The credit shall be computed in the same manner and be subject to the same limitations as the credit granted to a resident.
(11) The State Forestry Department, after consultation with the Department of Revenue, shall adopt rules for the purposes of ORS 315.124 to 315.132, including policies and procedures for certifying taxpayers as eligible for the credit allowed under this section as required in ORS 315.126.
(12) The Department of Revenue shall adopt rules for the purposes of ORS 315.124 to 315.132. [2022 c.34 §2]