Trees Planted for Landscaping
Around your home
"Shade trees" or "ornamental" trees are real property and are usually valued for their in-place aesthetic beauty.
The cost of the trees, and any additional costs that were incurred to plant the trees, should be added to the basis of the land. If you have not established a basis for your property or are unsure how to do so click here.
It is important to maintain an accounting of the value of your property and any improvements that have been made such as planting "ornamental" or "shade trees" for purposes of calculating a casualty loss if necessary. For a more in depth discussion of shade tree casualty losses click here.
Around a business
"Shade trees" or "ornamental" trees refers to those which are planted primarily for their in-place aesthetic beauty.
Trees planted for landscaping around your business are not subject to the uniform capitalization rules since they are not for use in your trade, business or other activity conducted for profit. The cost of the trees, and any additional costs that were incurred to plant the trees, should be recorded in a separate account from the land and other capital assets. If an account is already established for "ornamental" or "shade trees" add the cost of the new trees to that account.
It is important to maintain a separate accounting of the "ornamental" or "shade trees" for purposes of calculating a casualty loss if necessary.