72-16-347. Special rule for disposition of timber. In the case of qualified woodland to which an election under 72-16-334 applies, if the qualified heir disposes of or severs any standing timber on the qualified woodland:
     (1) the disposition or severance is treated as a disposition of a portion of the interest of the qualified heir in the property; and
     (2) the additional tax imposed by 72-16-338 with respect to the disposition is an amount equal to the lesser of:
     (a) the amount realized on the disposition or, in any case other than a sale or exchange at arm's length, the fair market value of the portion of the interest disposed or severed; or
     (b) the amount of additional tax determined under this section, without regard to this subsection (2)(b), if the entire interest of the qualified heir in the qualified woodland had been disposed of, less the sum of the amount of the additional tax imposed with respect to all prior transactions involving the woodland to which subsection (2) applied.
     (3) For purposes of subsection (2), the disposition of a right to sever is treated as the disposition of the standing timber. The amount of additional tax imposed under 72-16-338 in a case in which a qualified heir disposes of his entire interest in the qualified woodland must be reduced by any amount determined under this section with respect to such woodland.

     History: En. Sec. 21, Ch. 511, L. 1983.