U.S. Christmas Tree Acreage Drops by 35% and Tax Rules for Older Trees Impact Social Security Earnings
From 2002 to 2022, U.S. Christmas tree acreage fell by 35%, from about 450,000 acres to roughly 293,000 acres, with around 10,000 farms harvesting approximately 14.5 million trees valued at $553 million in 2022. The decline reflects challenges in sustaining the long growing cycle required for Christmas trees, which typically take seven to ten years before harvest. For growers collecting Social Security while still working on their farms, a tree's age can significantly affect how income is treated under federal tax rules. Ornamental evergreens older than six years when cut qualify as timber under IRS Section 631(a), allowing the gain from cutting them to be excluded from net earnings for Social Security’s purposes if certain conditions are met. Growers must own the trees for over a year and elect this treatment on their original tax return before harvest. This distinction can reduce how much of the income is counted toward the annual earnings limit, which affects benefit reductions for those under full retirement age.
Topics: Christmas tree farming IRS Section 631(a) Social Security earnings test U.S. agriculture trends