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WALNUT TREE BUYERS? Top Notch buyer, IA sale 150-ish trees

I the first post you mentioned 19 inch or bigger is that diameter at chest height or some other place. i began marking some of mine and am passing on all smaller than 56 inch circumference which will be close to a 15inch log small end . I have 61 marked so and am guessing about 10,000 board feet. still have more to mark.
 
I am marking a minimum of 19" dbh. So at chest level. I have skipped past some at 18-22" for various reasons as well though. I really like jw's article he attached. Right after 10th of jan (end of season) I'm having state forester out - think its good to get 2nd opinion. The veneer logs will likely be 26" dbh minimum. I still have a lot of timber to sort through and this is my new farm so it'll b interesting how the total comes out. I'm also doing 100 acres of tsi so I am thinking the ground should be in great shape for cover, log sales and future log income. Freeing up 5-25" veneer walnuts will have a nice future as well as all the oaks and girdling the undesireable species and trees.
 
One thing I failed to mention before, and if you have recently acquired this property it is very relevant in your case, is you should get an appraisal done by a forester to establish your basis. When having a timber sale you will be subject to capital gains taxes, but only on your net capital gains. Meaning, if the property had $10 worth of walnut on it when you bought it, and you sold some walnut 10 years later for $15k, your tax liability is only on the difference ($5k), not the entire $15k. This can be a huge deal if you are talking about a couple hundred walnut trees, which could produce some significant income.

You should really talk with you tax person, and get a forester to appraise your timber to establish your basis. Your basis can also be established retroactively, so if you purchased a property say 10 years ago, you could still establish the basis for the time of purchase.

If you are in NE Iowa and are interested in an appraisal, PM me for the name of a guy I highly recommend.
 
I did purchase the land 6 months ago near Des moines. If I sell some trees in the next 3-4 months- would this make any difference (say vs 10 years from now)? And being taxed at a capital gains rate- why wouldn't it be normal income tax? It's a farming operation that has substantial income and always will. My mother-in-law is an accountant, I'll ask her this stuff BUT a lot of this is news to me and great information!!! Much appreciated!!!
 
No problem Sligh. If the trees are sold soon after the property is purchased, you should be able to reduce your tax liability quite a bit. I believe the timber is considered as "capital" when you purchase the land. So any income gained from the sale of that "capital" would be subject to capital gains taxes. It is all pretty confusing to me, but I know it can be well worth your while if you investigate it.

If you are planning on selling any timber in the future, you should still get a basis established so that you only pay taxes on "growth". I believe if you sold today, you would likely have very little tax to pay as your basis should be somewhat close to what you actually sell the timber for. If you wait 10 years, those trees will likely grow, and gain value. You are then liable for taxes on only that gain in value. On the other hand, if the markets tank and you sell your timber for less than what you basis was, you would have negative capital gains, and probably no tax liability.

Definitely make sure you check it out with the professionals so everything is on the up and up, but when selling high value timber it will be well worth your time. Also, consultant forester will charge a fee to establish your basis, but it will be pennies compared to what you would likely save.
 
jw_wildfire said:
No problem Sligh. If the trees are sold soon after the property is purchased, you should be able to reduce your tax liability quite a bit. I believe the timber is considered as "capital" when you purchase the land. So any income gained from the sale of that "capital" would be subject to capital gains taxes. It is all pretty confusing to me, but I know it can be well worth your while if you investigate it.

If you are planning on selling any timber in the future, you should still get a basis established so that you only pay taxes on "growth". I believe if you sold today, you would likely have very little tax to pay as your basis should be somewhat close to what you actually sell the timber for. If you wait 10 years, those trees will likely grow, and gain value. You are then liable for taxes on only that gain in value. On the other hand, if the markets tank and you sell your timber for less than what you basis was, you would have negative capital gains, and probably no tax liability.

Definitely make sure you check it out with the professionals so everything is on the up and up, but when selling high value timber it will be well worth your time. Also, consultant forester will charge a fee to establish your basis, but it will be pennies compared to what you would likely save.
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Good advice I just purchased a new farm, and I did not even think of that!
Part of my farm is in an IRA, so I assume that should establish a basis for the IRA timber value as well. Thanks for the heads up!

:way:
 
We used a private forester Bob Petrzelka with Geode Forestry 319-931-0889. Highly recommend him for his professionalism and willingness to satisfy the land owner's habitat goals. We explained to him what we want out of our timber with money not being the highest consideration. Our goals were to improve deer and turkey habitat as well as maximize oak regeneration. Between Bob and the local NRCS office we have several programs taking place right now that are helping us reach our goals as well as putting a little cash in our pockets.
 
If you don't have the farm for a year, pretty sure you have to pay short term capital gains tax. I'd hold for a year at least and then sell the timber personally.
 
Got em all marked, measured, etc! 141. Got some veneer logs and lumber logs of course. Wide range of trees (but a very small amount are really "messy" trees)- nice combo of veneer and lumber. Some really nice stuff. I did mark a few from 15-18" that were right on the creek that will eventually fall in BUT otherwise I marked a minimum of 19" for lumber logs (vast majority is 19"-26") and most the veneer is 24-29". Varies of course. 141 trees total. Vast majority of trees are 20-28". I was very conservative with what I marked and I really marked stuff that was ready to come out. I have them all listed out with DBH & Log length per tree- laid out in an Excel sheet. I think the highest range for tree was 31".

141 trees total. Probably send out bid notice in a week. JW- any other thoughts?!?!? :)
 
Great ideas JW, I'm walking our farm with a logger this weekend... I'll have to ask dad about having the timber apraised for taxes puposes as well... we more than likely fall under the category of owning the land for 10 years and never having it appraised... we'll see how that goes.
 
Sligh - Looks like you have set yourself up for a nice sale! Hopefully you have the bonded timber buyers list, and I suggest sending bids to as many of those folks as you can. Also I hope you spoke with your district forester as they may have some insight on which loggers may be seriously interested in your area. The trees you describe should get quite a bit of interest, and possibly from folks pretty far away.

Loesshills - be cautious walking your property with a "logger". Most are great guys, but they are in the business of getting your product as cheap as possible. Most times they don't necessarily have your goals or objectives in mind. A forester will give you an independent opinion of your woods, and make recommendations with your best interests in mind.

Good luck! Let me know if you have questions or concerns!
 
jw_wildfire said:
Loesshills - be cautious walking your property with a "logger". Most are great guys, but they are in the business of getting your product as cheap as possible. Most times they don't necessarily have your goals or objectives in mind. A forester will give you an independent opinion of your woods, and make recommendations with your best interests in mind.
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Don't mean to hyjack the thread here Skip, but this is a sweet thread.

I contacted the forestere today and odds are slim I get to talk with them before Saturday's stroll with the logger... we'll talk to the logger and go from there but definitely talking/walking with the forester before anything is finalized. Thanks for the help JW and Skip! :way:
 
What kind of money can a guy expect from black walnut right now? I know a lot depends on size etc but can someone make a guess based on about 23 trees. 20 are only good for saw logs and 3 are veneer quality.
 
What diameters r u talking, how many logs avg? Wide range and any info on that would really help!What's the ranges- like r we talking 18" trees or 28" for example- just throw out some guesstimates.
 
I figured it would be impossible to estimate without more info. I'm 5 hours away and I'm not sure what the trees are like. I had a guy look at the farm and give us an quote. For such a small qty I don't think a forester would bother but I did want to see if his quote was reasonable. I might head down next weekend and get some more info.
 
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