The IRS made the announcement Thursday, saying the extension affects drought sales that occurred during 2015 as the normal drought-sale replacement period is four years.
The agency says qualifying farmers and ranchers whose drought-sale replacement period was scheduled to expire at the end of 2019 now have until the end of their next tax year to replace the livestock and defer tax on any gains from the forced sales.
Officials say sales of poultry or other livestock, such as those raised for slaughter or held for sporting purposes, are not eligible.