Tax Losses For Trees and Consulting

A research study done by the U.S. Forest Service in the Northeast on paired homes showed that homes with tree cover sold for 20% more than the same type home on bare ground.  So, a typical $250,000 property might assign as much as $50,000 to the trees.  Over the years, the International Society of Arboriculture has developed a valuation method for trees that starts with a measurement of DBH (diameter at breast height), which is a standard forestry measurement for trees.  From the DBH measurement, we arrive at Basic Value, or BV, which is the number of square inches of tree trunk at DBH multiplied by $40.  This is an ideal or optimal figure.  Therefore, a 12inch DBH tree would have a BV of $524.  This value is subject to significant deductions based on species, condition and location.  Now, BV is simply a number to get at the landscape value of irreplaceable trees.  Planting even a smaller diameter tree would cost more.   But the cost of cure, that is, the cost of removal and stump grinding could be significantly less.  It is assumed that the landowner would have to pay the cost of cure from the proceeds of the tree values, if any.

In tort cases, courts usually recognize ISA tree values but homeowners' insurance companies are consistently stingy.  So, if the landowner can find a defendant who destroyed his trees, he's likely to get paid by the courts.  If the destruction of trees was by an act of God, he's unlikely to get paid more than a token $500 amount from homeowner's insurance.  Any licensed arborist who is knowledgeable about the factors in the ISA guide can make such a determination.  If the loss is uninsured, and the landowner seeks relief through a casualty loss claim on his federal income tax, then the value determination can only be made by a graduate forester to satisfy IRS rules.  Of course, the total recovery of funds by the landowner depends on his Federal income tax bracket.  Wealthier, high-bracket individuals can recover more money from the same tree than poor people.  IRS rules also dictate that a recovery can be made from lightning, wind damage (hurricanes, etc.), forest fire, beetle kill – but NOT from the effects of progressive disease, such as root or butt rot.

I usually charge a landowner 1 1/2% of the loss value I discover, adding travel expenses, with a minimum of $150.  So, if a 40% bracket owner of a million-dollar property loses all of his trees, he could expect to recover $80,000 from his income tax bill.   That would easily cover my $1200 fee.

I you have questions, e-mail me at or phone my cell at 504-259-2031

I also provide expert testimony and consultation in legal situations involving property disputes, personal injury or wrongful death involving trees.  I can render opinions about the condition of trees and risks on properties slated for purchase.