WASHINGTON, DC – The IRS announced Friday that farmers forced to sell cattle due to the drought may have an extra year to replace them and defer taxes on any profits from the foreclosed sales.
To qualify, farmers or ranchers who qualified for the four-year replacement period must have sold cattle solely because of drought conditions.
The one-year extension gives those who are eligible to replace the livestock sold by the end of their first tax year after the first drought-free year.
North Dakota farmers and ranchers may apply if their area experiences exceptional, extreme, or severe drought conditions in any week between September 1, 2020 and August 31, 2021.
The exemption applies to capital gains from the sale of livestock raised for migration, dairy or breeding purposes.
The sale of other slaughter or sporting cattle or poultry is not eligible.
For more information on qualification requirements, please visit the IRS website here.
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