The Internal Revenue Service issued an extension on Monday for farmers and ranchers in Utah to replace livestock sold during times of drought. The livestock replacement period was originally scheduled to run until December 31st of this year but is now set for the end of 2015.
Farmers in 24 counties across the state who sold more livestock than normal due to drought will now be able to delay paying taxes on gains from livestock purchases. In a statement from the IRS, the extension only applies to livestock raised for specific purposes.
“The one-year extension of the replacement period announced today 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. Sales of other livestock, such as those raised for slaughter or held for sporting purposes, and poultry are not eligible,” the statement said.
According to the National Drought Mitigation Center, most of Utah ranges from abnormally dry to being in severe drought. Nationally, areas in the western United States are hardest hit by poor precipitation. Drought sales replacement period is four years, meaning the action by the IRS will impact sales dating back to 2010.
30 states are affected by the extension.
