SECTION 3. EXTENSION OF

REPLACEMENT PERIOD UNDER § 1033(e)(2)(B)

Notice 2006–82, 2006–2 C.B. 529, provides for extensions of the replacement period under § 1033(e)(2)(B). If a sale or exchange of livestock is treated as an involuntary conversion on account of drought and the taxpayer’s replacement period is

determined under § 1033(e)(2)(A), the replacement period will be extended under § 1033(e)(2)(B) and Notice 2006–82 until the end of the taxpayer’s first taxable year ending after the first drought-free year for the applicable region. For this purpose, the first drought-free year for the applicable region is the first 12-month period that (1) ends August 31; (2) ends in or after the last year of the taxpayer’s 4-year replacement period determined under § 1033(e)(2)(A); and (3) does not include any weekly period for which exceptional, extreme, or severe drought is reported for any location in the applicable region. The applicable region is the county that experienced the drought conditions on account of which the livestock was sold or exchanged and all counties that are contiguous to that county.

A taxpayer may determine whether exceptional, extreme, or severe drought is reported for any location in the applicable region by reference to U.S. Drought Monitor maps that are produced on a weekly basis by the National Drought Mitigation Center. U.S. Drought Monitor maps are archived at www.drought.unl.edu/dm/archive.html.

In addition, Notice 2006–82 provides that the Internal Revenue Service will publish in September of each year a list of counties, districts, cities, or parishes (hereinafter “counties”) for which exceptional, extreme, or severe drought was reported during the preceding 12 months. Taxpayers may use this list instead of

2009–40 I.R.B. 456 October 5, 2009

APPENDIX

Alabama

Counties of Calhoun, Chambers, Cherokee, Cleburne, DeKalb, Jackson, Lee, Madison, Randolph, Russell.

California

Counties of Alameda, Alpine, Amador, Butte, Calaveras, Colusa, Contra Costa, Del Norte, El Dorado, Fresno, Glenn, Humboldt, Imperial, Inyo, Kern, Kings, Lake, Lassen, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Modoc, Mono, Monterey, Napa, Nevada, Orange, Placer, Plumas, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Francisco, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Shasta, Sierra, Siskiyou, Solano, Sonoma, Stanislaus, Sutter, Tehama, Trinity, Tulare, Tuolumne, Ventura, Yolo, Yuba.

Colorado

Counties of Baca, Bent, Las Animas, Prowers.

Florida

Counties of Alachua, Brevard, Broward, Charlotte, Citrus, Collier, DeSoto, Flagler, Glades, Hardee, Hendry, Hernando, Highlands, Hillsborough, Indian River, Lake, Lee, Levy, Manatee, Marion, Martin, Miami-Dade, Monroe, Okeechobee, Orange, Osceola, Palm Beach, Pasco, Pinellas, Polk, Putnam, St. Johns, St. Lucie, Sarasota, Seminole, Sumter, Volusia.

Georgia

Counties of Appling, Baldwin, Banks, Barrow, Bartow, Ben Hill, Bibb, Bleckley, Bulloch, Burke, Butts, Candler, Carroll, Catoosa, Chattahoochee, Chattooga, Cherokee, Clarke, Clayton, Cobb, Coffee, Columbia, Coweta, Crawford, Crisp, Dade, Dawson, DeKalb, Dodge, Dooly, Douglas, Elbert, Emanuel, Fannin, Fayette, Floyd, Forsyth, Franklin, Fulton, Gilmer, Glascock, Gordon, Greene, Gwinnett, Habersham, Hall, Hancock, Haralson, Harris, Hart, Heard, Henry, Houston, Irwin, Jackson, Jasper, Jeff Davis, Jefferson, Jenkins, Johnson, Jones, Lamar, Laurens, Lincoln, Lumpkin, McDuffie, Macon, Madison, Marion, Meriwether, Monroe, Montgomery, Morgan, Murray, Muscogee, Newton, Oconee, Oglethorpe, Paulding, Peach, Pickens, Pike, Polk, Pulaski, Putnam, Rabun, Richmond, Rockdale, Schley, Screven, Spalding, Stephens, Stewart, Sumter, Talbot, Taliaferro, Tattnall, Taylor, Telfair, Toombs, Towns, Treutlen, Troup, Twiggs, Union, Upson, Walker, Walton, Warren, Washington, Webster, Wheeler, White, Whitfield, Wilcox, Wilkes, Wilkinson.

Hawaii

Counties of Hawaii, Honolulu, Kauai, Maui.

Kansas

Counties of Barber, Clark, Comanche, Hamilton, Meade, Morton, Seward, Stanton, Stevens.

Kentucky

Counties of Adair, Allen, Anderson, Barren, Bath, Bell, Bourbon, Boyle, Breathitt, Butler, Calloway, Carter, Casey, Christian, Clark, Clay, Clinton, Cumberland, Edmonson, Elliott, Estill, Fayette, Fleming, Floyd, Franklin, Garrard, Grayson, Green, Hardin, Harlan, Harrison, Hart, Jackson, Jessamine, Johnson, Knott, Knox, Larue, Laurel, Lawrence, Lee, Leslie, Letcher, Lincoln, Logan, McCreary, Madison, Magoffin, Marion, Martin, Menifee, Mercer, Metcalfe, Monroe, Montgomery, Morgan, Muhlenberg, Nelson, Nicholas, Owsley, Perry, Pike, Powell, Pulaski, Rockcastle, Rowan, Russell, Scott, Shelby, Simpson, Spencer, Taylor, Todd, Trigg, Warren, Washington, Wayne, Whitley, Wolfe, Woodford.

Louisiana

Parishes of Assumption, Lafourche, St. Martin, St. Mary, Terrebonne.

Michigan

Counties of Delta, Dickinson, Gogebic, Houghton, Iron, Marquette, Menominee, Ontonagon.

Minnesota

Counties of Aitkin, Anoka, Blue Earth, Carlton, Carver, Cass, Chisago, Crow Wing, Dakota, Dodge, Faribault, Fillmore, Freeborn, Goodhue, Hennepin, Houston, Isanti, Itasca, Kanabec, Le Sueur, Martin, Olmsted, Pine, Ramsey, Rice, Scott, Sherburne, Sibley, Wabasha, Waseca, Washington, Watonwan, Winona, Wright.

Montana

Counties of Cascade, Custer, Daniels, Dawson, Fallon, Flathead, Glacier, Lake, Lewis and Clark, Liberty, Lincoln, McCone, Pondera, Prairie, Richland, Roosevelt, Sanders, Sheridan, Teton, Toole, Valley, Wibaux.

October 5, 2009 457 2009–40 I.R.B.

Nevada

Carson City. Counties of Churchill, Douglas, Elko, Eureka, Humboldt, Lander, Lincoln, Lyon, Nye, Pershing, Storey, Washoe, White Pine.

New Mexico

Counties of Chaves, DeBaca, Dona Ana, Eddy, Guadalupe, Lea, Lincoln, Luna, Otero, Roosevelt, Sierra, Socorro, Torrance, Union.

North Carolina

Counties of Alexander, Alleghany, Ashe, Avery, Bertie, Buncombe, Burke, Cabarrus, Caldwell, Camden, Catawba, Cherokee, Chowan, Clay, Cleveland, Currituck, Dare, Edgecombe, Gaston, Gates, Graham, Greene, Halifax, Haywood, Henderson, Hertford, Iredell, Jackson, Lincoln, McDowell, Macon, Madison, Martin, Mecklenburg, Mitchell, Nash, Northampton, Pasquotank, Perquimans, Pitt, Polk, Rowan, Rutherford, Swain, Transylvania, Vance, Warren, Watauga, Wayne, Wilkes, Wilson, Yadkin, Yancey.

North Dakota

Counties of Adams, Billings, Bowman, Burke, Divide, Dunn, Golden Valley, Grant, Hettinger, McKenzie, McLean, Mercer, Morton, Mountrail, Oliver, Slope, Stark, Ward, Williams.

Oklahoma

Counties of Alfalfa, Atoka, Beaver, Beckham, Blaine, Bryan, Caddo, Carter, Choctaw, Cimarron, Coal, Comanche, Cotton, Custer, Dewey, Ellis, Garfield, Garvin, Grady, Greer, Harmon, Harper, Hughes, Jackson, Jefferson, Johnston, Kingfisher, Kiowa, Love, McClain, Major, Marshall, Murray, Pittsburg, Pontotoc, Roger Mills, Stephens, Texas, Tillman, Washita, Woods, Woodward.

Oregon

Counties of Curry, Harney, Josephine, Lake.

South Carolina

Counties of Abbeville, Aiken, Allendale, Anderson, Bamberg, Barnwell, Cherokee, Chester, Edgefield, Fairfield, Greenville, Greenwood, Lancaster, Laurens, Lexington, McCormick, Newberry, Oconee, Orangeburg, Pickens, Richland, Saluda, Spartanburg, Union, York.

Tennessee

Counties of Anderson, Bedford, Benton, Bledsoe, Blount, Bradley, Campbell, Cannon, Carter, Cheatham, Claiborne, Clay, Cocke, Coffee, Cumberland, Davidson, DeKalb, Dickson, Fentress, Franklin, Grainger, Greene, Grundy, Hamblen, Hamilton, Hancock, Hawkins, Henry, Houston, Humphreys, Jackson, Jefferson, Johnson, Knox, Loudon, McMinn, Macon, Marion, Meigs, Monroe, Montgomery, Moore, Morgan, Overton, Pickett, Polk, Putnam, Rhea, Roane, Robertson, Rutherford, Scott, Sequatchie, Sevier, Smith, Stewart, Sullivan, Sumner, Trousdale, Unicoi, Union, Van Buren, Warren, Washington, White, Williamson, Wilson.

Texas

Counties of Andrews, Aransas, Archer, Atascosa, Austin, Bandera, Bastrop, Baylor, Bee, Bell, Bexar, Blanco, Borden, Bosque, Brazoria, Brazos, Brooks, Brown, Burleson, Burnet, Caldwell, Calhoun, Callahan, Cameron, Chambers, Childress, Clay, Coke, Coleman, Collingsworth, Colorado, Comal, Comanche, Concho, Cooke, Coryell, Cottle, Crane, Crockett, Crosby, Culberson, Dallam, Dawson, Denton, DeWitt, Dickens, Dimmit, Duval, Eastland, Ector, Edwards, El Paso, Erath, Falls, Fayette, Fisher, Foard, Fort Bend, Freestone, Frio, Gaines, Galveston, Garza, Gillespie, Glasscock, Goliad, Gonzales, Grayson, Grimes, Guadalupe, Hamilton, Hardeman, Harris, Haskell, Hays, Hidalgo, Hill, Houston, Howard, Hudspeth, Irion, Jack, Jackson, Jeff Davis, Jim Hogg, Jim Wells, Jones, Karnes, Kendall, Kenedy, Kent, Kerr, Kimble, King, Kinney, Kleberg, Knox, Lampasas, La Salle, Lavaca, Lee, Leon, Liberty, Limestone, Lipscomb, Live Oak, Llano, Loving, McCulloch, McLennan, McMullen, Madison, Martin, Mason, Matagorda, Maverick, Medina, Menard, Midland, Milam, Mills, Mitchell, Montague, Montgomery, Motley, Navarro, Nolan, Nueces, Palo Pinto, Parker, Polk, Presidio, Reagan, Real, Reeves, Refugio, Robertson, Runnels, San Jacinto, San Patricio, San Saba, Schleicher, Scurry, Shackelford, Starr, Stephens, Sterling, Stonewall, Sutton, Taylor, Throckmorton, Tom Green, Travis, Trinity, Upton, Uvalde, Val Verde, Victoria, Walker, Waller, Ward, Washington, Webb, Wharton, Wichita, Wilbarger, Willacy, Williamson, Wilson, Winkler, Wise, Young, Zapata, Zavala.

Utah

Counties of Juab, Millard, Tooele.

2009–40 I.R.B. 458 October 5, 2009

Virginia

Cities of Bristol, Chesapeake, Emporia, Franklin, Galax, Norton, Radford, Suffolk, Virginia Beach. Counties of Bland, Brunswick, Buchanan, Carroll, Craig, Dickenson, Floyd, Giles, Grayson, Greensville, Isle of Wight, Lee, Mecklenburg, Montgomery, Pulaski, Roanoke, Russell, Scott, Smyth, Southampton, Sussex, Tazewell, Washington, Wise, Wythe.

Washington

Counties of Chelan, Clallam, Douglas, Grant, Grays Harbor, Jefferson, Mason, Okanogan.

West Virginia

Counties of Boone, Lincoln, Logan, McDowell, Mercer, Mingo, Monroe, Raleigh, Summers, Wayne, Wyoming.

Wisconsin

Counties of Adams, Ashland, Barron, Bayfield, Buffalo, Burnett, Chippewa, Clark, Door, Douglas, Dunn, Eau Claire, Florence, Forest, Iron, Jackson, Juneau, La Crosse, Langlade, Lincoln, Marathon, Marinette, Menominee, Monroe, Oconto, Oneida, Outagamie, Pepin, Pierce, Polk, Portage, Price, Rusk, St. Croix, Sawyer, Shawano, Taylor, Trempealeau, Vilas, Washburn, Waupaca, Wood.

Wyoming

Counties of Fremont, Lincoln, Sublette, Sweetwater, Uinta.

securities generally limited in respect of any one issuer to an amount not greater in value than 5 percent of the value of the total assets of the corporation and to not more than 10 percent of the outstanding voting securities of such issuer.

.03 Section 851(b)(3)(B) requires that, in order for a corporation to qualify as a RIC, not more than 25 percent of the corporation’s total assets may be invested in the securities (other than Government securities and the securities of other RICs) of any one issuer, or of two or more issuers that the corporation controls and which are determined, under regulations, to be engaged in the same or similar trades or businesses or related trades or businesses, or the securities of one or more publicly traded partnerships (as defined in section 851(h)). .04 In certain situations, the Service treats a RIC that invests in certain partnerships as if it directly invested in the assets held by the partnership for purposes of the asset diversification tests of section 851(b)(3) (Look-Through Treatment). Rev. Proc. 2001–57, 2001–2 C.B. 577, extends Look-Through Treatment to certain RICs in a master-feeder structure. See also Rev. Proc. 2005–20, 2005–1 C.B. 990, amplifying and superseding Rev. Proc. 2003–32, 2003–1 C.B. 803 (extending Look-Through Treatment to certain RICs that invest in eligible tax-exempt bond partnerships).

26 CFR 601.601: Rules and regulations. (Also: Part 1, § 851; 1.851–2.)

Rev. Proc. 2009–42