Montana ranchers more time to replace livestock
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News from the Internal Revenue Service
MONTANA — Montana farmers and ranchers who previously were forced to sell livestock due to drought have an extended period of time in which to replace the livestock and defer tax on any gains from the forced sales, according to the Internal Revenue Service.
As a result, farmers and ranchers in Lake County and 29 other Montana counties whose drought sale replacement period was scheduled to expire at the end of this tax year, Dec. 31, 2015, in most cases, will now have until the end of their next tax year.
To qualify, the livestock generally must be replaced within a four-year period. The IRS is authorized to extend this period if the drought continues.
The one-year extension of the replacement period generally applies to capital gains realized by eligible farmers and ranchers on sales of livestock held for draft, dairy or breeding purposes due to drought. However, sales of other livestock, such as poultry or those raised for slaughter or held for sporting purposes, and are not eligible.
Details on this relief, including a list of all the NDMC-designated counties, are available in Notice 2015-69 (http://www.irs.gov/pub/irs-drop/n-15-69.pdf), posted recently on IRS.gov.
