Section 35-3-05-09-102 - Applications1. For purposes of computing eligible costs on which the RTC is computed, total expenditures made during the taxable year on all eligible acres must be reduced by the amount of any cost-sharing proceeds received from federal and/or state forestry incentives programs with respect to such eligible acres.2. Reforestation costs generally must be capitalized and included in the adjusted basis of the qualified timber property. Any reforestation costs incurred and paid during a tax year must be reduced by the amount of any federal and/or state cost-sharing proceeds received, and the adjusted basis of the property decreased accordingly. If the taxpayer claims investment tax credit and reforestation amortization deductions with respect to qualifying reforestation expenditures for Federal income tax purposes, the basis of the qualified timber property (for State purposes) shall first be reduced by 50% of the federal investment tax credit. In addition, the adjusted basis of the property must be reduced by 100% of the reforestation tax credit earned with respect to that property. With respect to the property on which the Federal investment tax credit and reforestation amortization deductions are claimed, amortization for State purposes may be claimed on the portion of the qualifying state reforestation expenditures (after being reduced by the Federal investment tax credit adjustment and the RTC earned) which exceeds the basis of the Federal qualifying reforestation expenditures (after being reduced by the Federal investment tax credit adjustment and the Federal amortization to be claimed.) Amortization for state purposes is to be computed in the same manner as for Federal purposes.35 Miss. Code. R. 3-05-09-102