119-s1141

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1141 Introduced in Senate

    (IS) ]

<DOC>

119th CONGRESS
 1st Session
 S. 1141

 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

 March 26, 2025

 Mr. Cassidy (for himself, Mr. Warnock, Mr. Tuberville, Mr. King, and 
 Mrs. Britt) 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 ``Disaster Reforestation 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 appraised value of such uncut 
 timber determined immediately before such loss 
 was sustained, over
 ``
            (ii) the salvage value of such timber.
 ``
        (B) Appraisal methods.--
 ``
            (i) In general.--With respect to the 
 appraisal of a timber casualty loss described 
 in subparagraph
        (A) --
 ``
            (I) the appraisal valuation date 
 shall be not later than 1 year after 
 the casualty loss, and
 ``
            (II) the appraisal shall--
 ``

    (aa) conform to the 
 Uniform Standards of 
 Professional Appraisal Practice

    (USPAP) ,
 ``

    (bb) be limited to the 
 value of the lost timber, and
 ``
            (cc) be completed by a 
 Federal- or State-certified 
 appraiser.
 ``
            (ii) Delay in completion of appraisal.--
 ``
            (I) In general.--In the case of 
 any taxpayer who is unable to obtain an 
 appraisal described in clause
            (i) before the due date of the return of 
 tax (including any extension of time 
 for filing such return) for the taxable 
 year in which the timber casualty loss 
 occurred, the taxpayer may elect to--
 ``

    (aa) with respect to the 
 return of tax for such taxable 
 year, include an estimate of 
 the value of the uncut timber 
 determined immediately before 
 the loss was sustained, and
 ``

    (bb) upon completion of 
 the appraisal within the period 
 described in clause
            (i) 
            (I) , 
 file an amended return for such 
 taxable year with respect to 
 any adjustment in taxable 
 income as determined pursuant 
 to subclause
            (II) .
 ``
            (II) Adjustment of taxable 
 income.--With respect to any taxpayer 
 who elects to provide an estimate 
 described in subclause
            (I) (aa) for any 
 taxable year in which a timber casualty 
 loss occurred, the taxable income of 
 the taxpayer for such taxable year 
 shall be increased or decreased, as 
 applicable, by an amount equal to the 
 difference between--
 ``

    (aa) the appraised value 
 of such uncut timber determined 
 immediately before such loss 
 was sustained, as determined 
 pursuant to the appraisal 
 described in clause
            (i) , and
 ``

    (bb) the estimate 
 provided by the taxpayer under 
 subclause
            (I) (aa) with respect 
 to such uncut timber.
 ``
            (C) 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 in connection with a trade or business that is not 
 a passive activity within the meaning of 

section 469.
 ``
            (D) Inclusion of pre-merchantable timber.--For 
 purposes of this paragraph, the term `uncut timber' 
 shall not fail to include pre-merchantable timber.
 ``
        (E) Reforestation requirement.--
 ``
            (i) In general.--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.
 ``
            (ii) Recapture.--The Secretary shall, by 
 regulations, provide for recapturing the 
 benefit of any deduction allowed under this 
 section with respect to any uncut timber 
 subject to loss to which subparagraph
        (A) applied if the taxpayer fails to comply with 
 clause
            (i) during the period provided under 
 such clause.
 ``
        (F) Other casualties.--For purposes of 
 subparagraph
        (A) , the term `other casualty' shall 
 include loss of any uncut timber from--
 ``
            (i) wood-destroying insects,
 ``
            (ii) wood-destroying invasive species, or
 ``
            (iii) severe drought.''.

    (b) Effective Date.--The amendments made by this section shall 
apply to losses sustained in taxable years beginning after the date of 
the enactment of this Act.
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