American farmers and ranchers who have sold or exchanged livestock due to drought conditions are eligible for tax relief, the IRS said in a Sept. 22 statement.
Generally, livestock sold due to drought must be replaced within four years. Under the latest extension, farmers and ranchers who had sold livestock due to drought, with replacement periods scheduled to expire by the end of 2025, will now have until the end of the 2026 tax year to make replacements.
Tax gains made from such sales or exchanges can be deferred, the agency said.
The relief applies to “capital gains realized by eligible farmers and ranchers from sales or exchanges of livestock held for draft, dairy, or breeding purposes. Sales of other livestock—such as those raised for slaughter or held for sporting purposes—and sales of poultry do not qualify,” the agency said….