H.R. 8538: Save America’s Family Forests Act of 2026

This bill, titled the Save America’s Family Forests Act of 2026, proposes amendments to the Internal Revenue Code to facilitate reforestation efforts through tax incentives. The key components of the bill include:

Increased Expensing for Reforestation Expenditures

The bill aims to raise the amount of money that a taxpayer can expense in relation to reforestation activities. Specifically:

• The base expensing amount will increase from $10,000 to $30,000 for certain expenditures.
• Another limit currently set at $5,000 will be raised to $15,000.

Additionally, starting in 2026, these limits will be adjusted each year to align with inflation, ensuring that they reflect rising costs over time.

New Tax Deduction for Disaster-Related Reforestation

The bill introduces a new section that allows taxpayers to deduct certain reforestation expenditures incurred due to qualified natural disasters. The main features include:

• A deduction of up to $500,000 for disaster-related reforestation expenditures for each qualified timber property.
• A cap of $1,000,000 on total deductions for all properties affected by a disaster.

Taxpayers must make an election to apply this deduction, and the deduction amounts will also be subject to inflation adjustments starting from 2026.

Qualifications and Conditions

For the deductions to apply, several conditions must be met:

• The expenditures must relate to uncut timber that was damaged in a disaster defined as a "qualified natural disaster." This includes events recognized by the President under the Stafford Act.
• Taxpayers who have received government reimbursements for their reforestation costs may have limitations on what can be deducted.
• There are special provisions regarding how deductions are allocated if a business is part of a controlled group or operates as a partnership or S corporation.

Recapture Provisions

If a taxpayer disposes of any qualified timber property within a specific period after claiming a deduction, they are subject to recapture rules that may require them to report the deduction as income. This applies for a period of 10 years from the tax year in which the deduction was claimed.

Regulations and Administration

The Secretary of the Treasury will have the authority to create necessary regulations to implement these provisions properly, ensuring transparency and compliance with overall tax laws.

Effective Date

The adjustments to the expensing amounts and the new tax deduction for disaster-related reforestation expenditures will apply to amounts paid or incurred in taxable years starting after December 31, 2026.

Relevant Companies

• PLNT - Planet Fitness, Inc.: While not directly related to timber or reforestation, companies with ties to land management or environmental sustainability could see impacts from increased demand for reforestation initiatives.
• WMT - Walmart Inc.: Retailers may experience shifts in supply chain sustainability strategies, particularly if partnering with reforestation efforts for sourcing products.