The Race Continues: Economic Growth vs. an Economic Tantrum-Week 9

Factors that Make Timberland an Attractive Asset:

4.  Tax Perspective:

The profit from the sale of timber and land is a taxable event. In most cases the profit is treated as capital gain rather than ordinary income. Stock which pays dividends are taxed as ordinary income.

Land and timber “dividends” are their growth and you do not draw those “dividends” until you sell either the land, timber, or both. Here again you can pick the time that is most beneficial to you to have that taxable event.

In these uncertain times, it is critical to remember that land is the source of all wealth. Every product that we humans consume originates with land. Not all tracts of land are equal in quality and portfolio management requires every investor to hold some cash for liquidity. But historically, long term the best investment is land.