IRS Extends Drought Replacement Period for Ranchers
- By: Paul Neiffer
- September 25th, 2012
- 1 Comment
The IRS announced today in Release 2012-72 that they have extended the period for replacing livestock sold due to drought for another year. Normally, if a rancher is forced to sell their breeding, draft or dairy livestock due to drought, any extra sales caused by drought is allowed to be deferred for up to four years.
This release extends this for another year if the rancher’s county was in a drought situation for at least one week during the period September 1, 2011 to August 31, 2012. This primarily gives relief to ranchers who had to sell their livestock in 2008 since their four year period would be ending December 31, 2012. They now have until December 31, 2013 to replace these sales.
In some cases, it may apply to years before 2008 if they were in an extended drought that had lasted until at least 2011.
Paul Neiffer, CPA
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a partner with CliftonLarsonAllen in Yakima, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. In fact, Paul drives combine each summer for his cousins and that is what he considers a vacation. Leave a comment for Paul. If you would like to leave a comment for Paul, follow the link above, however, please make sure to include your email address so that he can reply to your comment (your email address will not automatically show up).
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