The IRS has issued estimated-tax penalty relief for taxpayers who properly elect under Sec. 1062 to pay tax on qualifying farmland sale or exchange gains in four annual installments. Under Notice 2026-3, you may exclude 75% of the applicable net tax liability from your estimated tax payment calculations for the year of sale or exchange, reducing exposure to estimated-tax penalties. The remaining 25% is due by the tax return deadline for that year. The relief generally applies automatically if no penalty is self-reported. If you’ve already reported a penalty or received a penalty notice from the IRS, you can request abatement using Form 843 and citing Notice 2026-3. We’re here to help.
Our Blog 