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Oklahomans forced by drought to sell livestock get tax break

The IRS is allowing Oklahoma farmers and ranchers to defer tax gains on forced livestock sales due to the drought.
by Don Mecoy Published: September 26, 2012
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The IRS provided the relief to any farm located in an area listed as suffering exceptional, extreme or severe drought conditions by the National Drought Mitigation Center, during any weekly period between Sept. 1, 2011, and Aug. 31, 2012. All or parts of 43 states were included in the IRS authorization.

The IRS said farmers and ranchers who, due to drought, sell more livestock than they normally would may defer tax on the extra gains from those sales. To qualify, the livestock generally must be replaced within a four-year period. The IRS may extend this period if the drought continues, as the agency did this year.

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. Sales of other livestock, such as those raised for slaughter or held for sporting purposes, and poultry are not eligible.

Don Mecoy, Business Writer

by Don Mecoy
Business Editor
Business Editor Don Mecoy has covered business news for more than a decade after earlier working on The Oklahoman's city, state and metro news desks, including a stint as city editor. He has won state and regional journalism awards for business,...
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