The IRS has extended tax relief to eligible farmers and ranchers who sold or exchanged livestock due to drought. Notice 2026-54 identifies qualifying areas in 49 states, the District of Columbia, Puerto Rico and other regions that experienced severe drought during the 12 months ended Aug. 31, 2026. The relief generally applies to gains from livestock held for draft, dairy or breeding. Poultry, as well as livestock raised for slaughter or held for sporting, don’t qualify. Eligible farmers and ranchers whose replacement period was to expire at the end of 2026 now have until the end of their next tax year to replace the livestock and defer tax on qualifying gains. Contact us with any questions.
