Forests are a significant pool of terrestrial carbon. A key feature related to forest biomass harvesting and use is the typical time difference between carbon release into and sequestration from the atmosphere. Traditionally, the use of sustainably grown biomass has been considered as carbon neutral in life cycle assessment (LCA) studies. However, various approaches to account for greenhouse gas (GHG) emissions and sinks of forest biomass acquisition and use have also been developed and applied, resulting in different conclusions on climate impacts of forest products. The aim of this study is to summarize, clarify, and assess the suitability of these approaches for LCA. A literature review is carried out, and the results are analyzed through an assessment framework. The different approaches are reviewed through their approach to the definition of reference land-use situation, consideration of time frame and timing of carbon emissions and sequestration, substitution credits, and indicators applied to measure climate impacts. On the basis of the review, it is concluded that, to account for GHG emissions and the related climate impacts objectively, biomass carbon stored in the products and the timing of sinks and emissions should be taken into account in LCA. The reference situation for forest land use has to be defined appropriately, describing the development in the absence of the studied system. We suggest the use of some climate impact indicator that takes the timing of the emissions and sinks into consideration and enables the use of different time frames. If substitution credits are considered, they need to be transparently presented in the results. Instead of carbon stock values taken from the literature, the use of dynamic forest models is recommended.