| First approximation: break-even formula |
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Break-even (B-E) formula
| Property tax deferred annually ($) | | |
| | = Annual break-even volume (MBF) | | Severance tax rate ($/MBF) | | |
Example
| $600 | | |
| | = 154.24 MBF | | $3.89/MBF | | |
Conclusion for example:
- If harvesting more than 154 MBF/year, choose forestland program.
- If harvesting less than 154 MBF/year, choose STF option.
Assumption to make B-E formula work
- Must harvest the same amount annually.
MBF = thousand board foot.
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