IRS extends the livestock replacement clock for drought affected farmers
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The IRS extended the livestock replacement period for qualifying farmers and ranchers in drought affected regions, Notice 2026-54 says. A period scheduled to expire in 2026 can continue through the first tax year ending after the region records a drought free year.
The standard clock is four years after the first tax year in which gain is realized. The rule applies to excess livestock held for draft, breeding or dairy purposes and sold solely because of drought. Poultry and animals raised for slaughter do not qualify.
The list is broad. It covers counties or other regions in 49 states, the District of Columbia, Puerto Rico and other areas. Florida entries include Charlotte, Collier, Hendry and Lee counties.
