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Georgia Gives Farmers and Timber Producers Tax Relief to Offset Hurricane Damage

Georgia Gives Farmers and Timber Producers Tax Relief to Offset Hurricane Damage

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Georgia has enacted a bill which provides wide-ranging tax relief to farmers and timber producers in the state who were affected by Hurricane Helene. The major hurricane passed through the state on September 26-27, 2025, and caused an estimated $5.5 billion in agricultural and forestry losses, according to study by the University of Georgia.

The Timberlands Recovery, Exemption, and Earnings Stability (TREES) Act (HB 223), signed into law by Governor Kemp on May 8, includes tax exclusions, a new tax credit and exemption from state and local sales taxes for timber taxes and for materials for agricultural structure rebuilding efforts.

Income Tax Exemptions

The law exempts from state income tax the following payments:

  • Federal disaster relief payments
  • Assistance grants administered by the state or the U.S. Agriculture Department

The exemption applies for taxable years beginning on or after January 1, 2025, and ending on or before December 31, 2029.

Also exempt from state income tax:

  • Federal crop insurance proceeds received for the destruction or damage to crops

The crop insurance exemption applies for taxable years beginning on or after January 1, 2025, and ending on or before December 31, 2025.

Reforestation Tax Credit

The new law also allows a tax credit targeted to taxpayers that suffered “substantial economic losses” and that will have to incur “significant expenses for salvaging downed timber, site clearance, restoration, and reforestation over the coming years.”

The credit amount is equal to 100% of a taxpayer’s timber casualty loss. However, the amount cannot exceed the number of the taxpayer’s affected acres of eligible timber property multiplied by $550.

The credit can only be claimed in the year the taxpayer completes restoration of the damaged acres or when the taxpayer replants timber in a quantity projected to yield at maturity at least 90% of the value of the timber casualty loss claimed. The timber must be planted in the same county as the lost timber acreage.

The credit is refundable, meaning it can exceed the taxpayer’s income tax liability. Excess credits may be carried forward for 10 years, and taxpayers may transfer or sell the credits one time to one single other Georgia taxpayer.

Note that a taxpayer must submit an application for preapproval of the credits based on timber casualty losses incurred by December 31, 2025. Tax credits must be claimed on or before December 31, 2030. 

Also note that the State will only preapprove $200 million in timber reforestation credits, so it is important to get a pre-approval application in before the credit fund is exhausted.

Local Timber Tax Exemption

The legislation authorizeslocal governing authorities to grant temporary ad valorem tax relief from taxes levied for eligible standing timber if the local governing authority is partially or wholly located in the FEMA declared disaster area. Taxpayers who receive the exemption must certify the damage with photographs of the damage or verification by a registered forester.

The exemption is allowed for the last quarter of 2024 and for each quarter of 2025.

Sales and Use Tax Exemptions, Agricultural Structures

Finally, the legislation allows a sales tax exemption for materials used to repair or replace agricultural structures, including poultry houses, livestock facilities, greenhouses and other agricultural buildings. The exemption is available from May 8, 2025 until December 31, 2025.

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