Relating to estate tax; and prescribing an effective date.

Forestland tax break comes with family rules

For deaths on or after January 1, 2026, qualifying Oregon forestland gets an estate tax exemption. The exemption covers up to $15 million per estate, not $15 million in tax savings. The person who died must have owned 10 to fewer than 5,000 acres throughout the five years before death. They must also have held the land for at least five years. They or a family member must have actively managed it during each of the five calendar years before death. Records must show management work suited to the land’s stage in the forest management cycle. The land must pass to family and remain family-owned for five consecutive calendar years starting the year after death. A family member must continue active management and keep similar records during each of those years. Family includes relatives within the third degree through blood, marriage, adoption, civil union, or domestic partnership. Estates cannot combine this exemption with the credit under ORS 118.140. A transfer outside the family or failure to meet management rules during the five-year period triggers repayment of the estate tax avoided, with applicable interest.