IRS Extends Reinvestment Period For Some Livestock Sales Forced By Drought
Courtesy of kla.org
Ranchers who were forced to sell livestock due to drought may have an additional year to replace those animals and defer tax on any gains from the forced sales, according to the Internal Revenue Service (IRS). The one-year extension gives eligible producers until the end of the tax year after the first drought-free year to replace livestock sold.
IRS is providing this extension to ranchers located in regions qualified for the four-year replacement period if any county in the area currently is listed as currently suffering exceptional, extreme or severe drought or severe drought conditions existed during any week between September 1, 2018, and August 31, 2019. All or parts of 32 states have been designated in these categories by the National Drought Mitigation Center.
As a result, qualified ranchers whose drought-sale replacement period is scheduled to expire December 31, 2019, in most cases, now have until the end of the next tax year. This extension immediately applies to drought sales that occurred during 2015. More information can be found in Publication 225, the Farmer’s Tax Guide, available on www.irs.gov.