Farmers and ranchers recently forced to sell livestock due to drought now affecting much of the U.S. have an extended time to replace the livestock and defer tax on any gains from the forced sales.
According to the IRS, to qualify the livestock must generally be replaced within four years. The one-year extension of the replacement period announced today generally applies to capital gains realized by eligible farmers and ranchers on sales of livestock held for draft, dairy or breeding purposes due to drought. Sales of other livestock, such as those raised for slaughter or sport, and poultry are ineligible.
The IRS can extend this period if the drought continues.
According to the IRS, to qualify the livestock must generally be replaced within four years. The one-year extension of the replacement period announced today generally applies to capital gains realized by eligible farmers and ranchers on sales of livestock held for draft, dairy or breeding purposes due to drought. Sales of other livestock, such as those raised for slaughter or sport, and poultry are ineligible.
The IRS can extend this period if the drought continues.
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