HONOLULU (KHON2) — Farmers and ranchers who were forced to sell livestock due to drought may have an additional year to defer tax on any gains from the forced sales, says the Internal Revenue Service (IRS).
Qualified farmers and ranchers whose drought-sale replacement period was set to expire on Dec. 31 will now have until the end of 2021 to replace sold livestock.
The IRS says the one-year extension aims to provide relief for those who were financially burdened by drought, flooding and other severe weather this year.
To qualify, farmers must live in applicable regions, which include states like Hawai’i, the District of Columbia and four U.S. territories.
Farmers and ranchers in Michigan, Ohio, Pennsylvania and Vermont do not qualify.
The IRS also adds that sales of other livestock, such as those raised for slaughter or held for sporting purposes or poultry, are not eligible.
Details, including an example of how this provision works, can be found here.
For more information on how to apply, visit their website.