Policy and Ordinances
Navigating forest finances, taxation, and timber sales can be a complicated process. Access Penn State Extension’s educational resources to learn more about forestry business and economics, forest policy, and timber ordinances. Information is also available on understanding timber taxation and property tax assessment.
Forest Policy and Ordinances
In Pennsylvania, forests cover more than 60% of the state. These 17 million acres of woodlands contribute significant benefits, such as protecting drinking water and providing wildlife habitats. What’s more, the state is one of the leading producers of hardwood timber in the country.
Forest policy incorporates laws and regulations – as negotiated between government and stakeholders – to manage and protect forests nationwide. Townships, boroughs, and counties in Pennsylvania are authorized by the Municipalities Planning Code to administer local land use planning.
Currently, timber harvesting in PA is regulated by a fraction of the state’s local governments. Ordinances have been developed to regulate timber harvest activities and maintain the state’s woodlands for future generations. These ordinances may include provisions requiring harvest plans and permits, as well as silvicultural regulations.
With the increase of residential development, more municipalities may begin to regulate timber harvest. Learn more about Pennsylvania forest policy and ordinances in the Dealing with Local Timber Harvesting Ordinances publication. Information is also available on recent forestry amendments and local government structures, as well as developing and applying for a timber harvesting permit.
Forest Finances and Timber Tax Laws
Timber harvesting and woodland stewardship provide valuable economic benefits to Pennsylvania communities. As most of PA forests are privately owned, landowners are obliged to pay the appropriate forest-related taxes, usually income taxes and annual property taxes.
Regardless of the forest’s main purpose, woodland management plans may eventually require commercial timber harvest. Landowners harvesting and selling timber are required to pay taxes for the expected returns from the land. The income from these sales is generally subject to income tax; however, it may be taxable as a long-term capital gain.
Property taxes in PA are typically based on the market value of the property. Eligible forest owners, however, can enroll in the Clean and Green preferential tax assessment program. The program aims to prevent landowners from selling or converting their land to other uses due to pressure from rising real estate taxes. The Clean and Green program provides tax relief by assessing values based on use values reflecting the land’s productive capability.
Forestry taxation can be a complex process, which is why working with professionals and gaining a better understanding of the importance of forest tax and financial planning is crucial.
In this section, find valuable Penn State Extension resources, including the Forest Finance and Timber Tax Education course. This online course is specially designed to help participants understand the tax code and how it applies to forests and woodlots. It further offers reputable sources, as well as practical advice for managing records and estate planning.
- Articles
Forest Carbon Market Structures and Mechanisms
This article provides an introduction to differences across carbon market structures. Content provided by the Forest Owner Carbon and Climate Education (FOCCE) program. - Articles
How a Forest Carbon Offset is Made and Sold
This article provides an introduction to basic offset market requirements, how forest offset projects are developed, and how credits are generated. - Articles
How Forest Carbon Programs Work: Two Case Studies With Private Organizations
This article explores the experience of two private organizations who enrolled in a carbon payments programs. - Articles
Public Demand for Forest Conservation and Water Protection in PA
This article presents estimated economic values for forest water protection programs in Pennsylvania using meta-analysis and benefit transfer techniques. - Articles
Reducing Carbon Emissions using Private Forests
Advocates of climate change mitigation are looking to private forest lands for solutions. This article discusses the opportunities and challenges of engaging landowners in carbon markets. - Articles
Strategic Messaging: A Guide for Leaders and Officials
A discussion on how intentional communication strategies can help advance the management of natural resources on private lands. - Online Courses
$160.00
Forest Taxation: Forest Finance and Timber Tax Education
Sections 13Length 8 hoursTax professionals and forest landowners learn about finance, taxation, and timber sales and taxation in order to save money on taxes. Earn 8 CFEs or 8 CPEs. - Articles
Dealing with Local Timber Harvesting Ordinances
Timber harvesting is regulated by a fraction of Pennsylvania's local governments, but more municipalities are beginning to regulate harvesting in order to maintain forests for future generations. - Articles
Forest Finance 4: Understanding Forest Property Tax Assessment in Pennsylvania
Property taxes are usually based on the property's fair market value, but many forest landowners in PA can enroll in a tax program known as Clean and Green. This option is explained in this article. - Articles
Forest Finance 5: Opportunities from Ginseng Husbandry in Pennsylvania
This article provides information on ginseng as a native forest resource, ginseng culture on Pennsylvania forest lands, and marketing and legal considerations.