XML 72 R38.htm IDEA: XBRL DOCUMENT v3.24.0.1
INCOME TAXES
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Rayonier is a REIT under the Internal Revenue Code and therefore generally does not pay U.S. federal or state income tax. As of December 31, 2023, Rayonier owns a 98.4% interest in the Operating Partnership and conducts substantially all of its timberland operations through the Operating Partnership. The taxable income or loss generated by the Operating Partnership is passed through and reported to its unitholders (including the Company) on a Schedule K-1 for inclusion in each unitholder’s income tax return. Certain operations, including log trading and certain real estate activities, such as the entitlement, development and sale of HBU properties, are conducted through our TRS. The TRS subsidiaries are subject to U.S. federal and state corporate income tax. The New Zealand timber operations are conducted by the New Zealand subsidiary, which is subject to corporate-level tax at 28% in New Zealand and is treated as a partnership for U.S. income tax purposes.
PROVISION FOR INCOME TAXES FROM CONTINUING OPERATIONS
The provision for income taxes for each of the three years ended December 31 follows:
 
202320222021
Current
U.S. federal
— ($2,797)($1,893)
State
(292)(371)(536)
Foreign
(4,441)(2,694)(11,425)
(4,733)(5,862)(13,854)
Deferred
U.S. federal
8,386 2,302 (6,288)
State
1,187 1,693 (1,623)
Foreign
(388)(3,583)(2,007)
9,185 412 (9,918)
Changes in valuation allowance
(9,574)(3,939)9,111 
Total
($5,122)($9,389)($14,661)
    A reconciliation of the U.S. federal statutory income tax rate to the actual income tax rate for each of the three years ended December 31 follows:
 202320222021
U.S. federal statutory income tax rate($38,560)(21.0)%($27,758)(21.0)%($47,280)(21.0)%
U.S. and foreign REIT income47,616 25.9 29,732 22.5 44,316 19.7 
Matariki Group and Rayonier New Zealand Ltd(3,681)(2.0)(5,038)(3.8)(12,927)(5.7)
Change in valuation allowance(9,574)(5.2)(3,939)(3.0)9,111 4.0 
REIT Built-in Gain— — (2,516)(1.9)(2,215)(1.0)
Foreign income tax withholding(1,148)(0.6)(1,239)(0.9)(505)(0.2)
Sale of Timber Funds— — — — (2,399)(1.1)
State Income Tax, Net of Federal Benefit1,322 0.7 1,424 1.1 — — 
Bainbridge Landing JV, NCI— — 2,496 1.8 — — 
Other(1,097)(0.6)(2,551)(1.9)(2,762)(1.2)
Income tax expense as reported for net income($5,122)(2.8)%($9,389)(7.1)%($14,661)(6.5)%
The Company’s effective tax rate is below the 21 percent U.S. statutory rate primarily due to tax benefits associated with being a REIT.
DEFERRED TAXES
Deferred income taxes result from differences between the timing of recognizing revenues and expenses for financial book purposes versus income tax purposes. The nature of the temporary differences and the resulting net deferred tax asset/liability for the two years ended December 31 follows:
 20232022
Gross deferred tax assets:
Pension, postretirement and other employee benefits$565 $489 
New Zealand subsidiary19,717 20,753 
Cellulosic Biofuel Producer Credit tax credit carry forwards13,688 13,688 
Capitalized real estate costs4,564 2,457 
U.S. TRS net operating loss30,061 23,885 
Other5,073 4,808 
Total gross deferred tax assets73,668 66,080 
Less: Valuation allowance(50,418)(40,844)
Total deferred tax assets after valuation allowance$23,250 $25,236 
Gross deferred tax liabilities:
Accelerated depreciation— (9)
New Zealand subsidiary(89,899)(88,414)
Other(3,616)(4,558)
Total gross deferred tax liabilities(93,515)(92,981)
Net deferred tax liability reported as noncurrent($70,265)($67,745)
Net operating loss (“NOL”) and tax credit carryforwards as of the two years ended December 31 follows: 
Tax Effected BalanceExpiration
2023
U.S. Federal NOL Carryforwards- Post TCJA (a)$25,948 None
U.S State NOL Carryforwards (b)4,112 Various
Cellulosic Biofuel Producer Credit13,688 2024
2022
U.S. Federal NOL Carryforwards- Post TCJA (a)$20,538 None
U.S State NOL Carryforwards (b)3,347 Various
Cellulosic Biofuel Producer Credit13,688 2024
(a)The Tax Cuts and Jobs Act (TCJA) was signed into law on December 22, 2017. The TCJA lifted the 20-year federal NOL Carryforward period. Net operating losses generated after December 31, 2017 have an indefinite carryforward period.
(b)The U.S. state NOL is made up of several jurisdictions that expire in various future years. No state NOL is set to expire before December 31, 2033.

We record a valuation allowance to reduce the carrying amounts of deferred tax assets if it is more likely than not that such deferred tax assets will not be realized. Since 2015, we have had a 100% valuation allowance against the U.S. taxable REIT subsidiary's deferred tax assets, net of deferred tax liabilities. During 2023, the net deferred tax assets increased by $9.6 million. As a result, we recorded a change in the valuation allowance of $9.6 million related to the U.S. TRS's deferred tax assets, net of liabilities.
TAX STATUTES
The following table provides detail of the tax years that remain open to examination by the IRS and other significant taxing jurisdictions:
Taxing JurisdictionOpen Tax Years
U.S. Internal Revenue Service2020 - 2022
New Zealand Inland Revenue2018 - 2022

TAX CHARACTERISTICS OF DIVIDEND DISTRIBUTIONS
The taxable nature of the dividend distributions paid for each of the three years ended December 31 follows:
 
202320222021
Total dividends/distributions paid per common share/unit (a)
$1.34 $1.125 $1.08 
Tax characteristics:
Capital gain100 %100 %100 %
(a)The year ended December 31, 2023 includes an additional cash dividend of $0.20 per common share. The dividend was payable January 12, 2024, to shareholders of record on December 29, 2023. This additional cash dividend will be considered a 2023 distribution for federal income tax purposes.