Without a special purpose, building a pond is just like putting in field tile or building a fence------such are     land improvements     and as such are capitalized and NOT depreciated.......exactly like raw land.  When land is sold, the cost of the improvement increases the costs which are offset against the sales price in determining the net taxable income.

However, if the pond is used in the production process----------ie watering livestock, source for irrigation of crops.......................then I would put it in same category as field tile and fence, which is that since it is a land improvement used directly in production process, it becomes a section 1245 asset, and all of the attributes of that are allowed--------Sec 179, etc.

If however the pond is NOT used as an integral part of the production process, then one would have to explore whether or not it qualifies as a convservation expense, and if it does, then it gets expensed just like anyother expense (feed, utilities, etc.), except that it is limited to 25% per year of the gross income from farming. ..................but one gets a carryforward which is unlimited as I recall...........ie carried forward until it is used up--------but one should check on that before relying on the carryforward period---might only be five years........I just don't remember about that, and the Blonde just called and has ordered me home.........so research is out of the question.

Remember that one of the qualifications of conservation expense is that it must be part of a plan approved by govt agency---------NRCS for example.

The only way expenses related to brushclearing, fixing waterways, etc. are expensed is if those waterways and brush areas are involved in production, so that the expenses are directly related to allowing the production process to continue appropriately.  Lots of people assume that if they clear some brush in the back 40 that it is deductible-------not necessarily true------has to be related to land used in production.  Otherwise such expenses have to be added to the cost of the land as land improvements.........deducted only when the land is sold.  That is why we always look over the dozers bills closely, and make sure such have been written up in a manner that achieves a good picture of what was actually done-------otherwise the wrong connotation might be taken by IRS.................and taxpayer would play hell in changing that attitude once it was established.

The term "waterway maintenance in crop areas" is an often used phrase.