Raina's Elektra

Managing Your Books and Freeing Your Mind

My Blog

Blog

« Back to Blog « Older Entry | Newer Entry »

Drought-stricken farmers and ranchers have more time to replace livestock

Posted on 4 October, 2018 at 13:03
Drought-stricken farmers and ranchers have more time to replace livestock
Farmers and ranchers who were forced to sell livestock due to drought may get extra time to replace the livestock and defer tax on any gains from the forced sales. Here are some facts about this to help farmers understand how the deferral works and if they are eligible.
  • The one-year extension gives eligible farmers and ranchers until the end of the tax year after the first drought-free year to replace the sold livestock.

  • The farmer or rancher must be in an applicable region. An applicable region is a county designated as eligible for federal assistance, as well as counties contiguous to that county.

  • The farmer’s county, parish, city or district included in the applicable region must be listed as suffering exceptional, extreme or severe drought conditions by the National Drought Mitigation Center. All or part of 41 states, plus the District of Columbia, are listed. The list of applicable regions is in Notice 2018-79 on IRS.gov.

  • The relief applies to farmers who were affected by drought that happened between Sept. 1, 2017, and Aug. 31, 2018.

  • This relief generally applies to capital gains realized by eligible farmers and ranchers on sales of livestock held for draft, dairy or breeding purposes. Sales of other livestock, such as those raised for slaughter or held for sporting purposes, or poultry are not eligible.

  • To qualify, the sales must be solely due to drought, flooding or other severe weather causing the region to be designated as eligible for federal assistance.

  • The farmers generally must replace the livestock within a four-year period, instead of the usual two-year period.

  • Because the normal drought sale replacement period is four years, this extension immediately impacts drought sales that occurred during 2014. But because of previous drought-related extensions affecting some of these areas, the replacement periods for some drought sales before 2014 are also affected.
Details, including an example of how this provision works, can be found in Notice 2006-82 on IRS.gov.
More Information:
Publication 225, Farmer’s Tax Guide
Share this tip on social media -- #IRSTaxTip: Drought-stricken farmers and ranchers have more time to replace livestock. https://go.usa.gov/xPKwA

Categories: IRS

Post a Comment

Oops!

Oops, you forgot something.

Oops!

The words you entered did not match the given text. Please try again.

100 Comments

Categories

Hypnotherapy Is HERE!!!

 Mobile Website:     http://m.rainaelektra.com

/
Lightbox image