Invest in Christmas Trees

christmas tree 2

Internal Revenue Code 631 allows Christmas tree farmers to have their profits taxed at capital gain rates, instead of ordinary income rates like other businesses, as long as they sell Christmas trees at least 6 years old.  Christmas trees usually fall under this deduction because it takes 6-12 years for a Christmas tree to grow to full size.

Internal Revenue Code 263A allows a Christmas tree farmer to deduct all of their expenses up front, in one year.  However, other tree farmers and other farmers must wait several years to enjoy the full deduction of their expenses.

Lastly, these two rules apply to Christmas trees grown in and out of the United States.

This entry was posted in General and tagged , , , , , , , , . Bookmark the permalink.

Leave a Reply