LIVESTOCK.

SEC. 212. LIVESTOCK. (a) Depreciation Recapture.— (1) General rule.—Section 1245(a)(2) (relating to recomputed basis with respect to gain from disposition of certain depreciable property) is amended by striking out “or” at the end of subparagraph (A), and by inserting immediately after subparagraph (B) the following: “(C) with respect to livestock, its adjusted basis recomputed by adding thereto all adjustments attributable to periods after December 31, 1969, or”. (2) Conforming amendment.—Section 1245(a)(3) (relating to section 1245 property) is amended by striking out “(other than livestock)”. (3) Effective date.—The amendments made by paragraphs (1) and (2) shall apply with respect to taxable years beginning after December 31, 1969. (b) Livestock Used in Trade or Business.— (1) Amendment of section 1231.—Section 1231(b)(3) (relating to property used in a trade or business) is amended to read as follows: “(3) Livestock.—Such term includes— “(A) cattle and horses, regardless of age, held by the taxpayer for draft, breeding, dairy, or sporting purposes, and held by him for 24 months or more from the date of acquisition, and “(B) other livestock, regardless of age, held by the taxpayer for draft, breeding, dairy, or sporting purposes, and held by him for 12 months or more from the date of acquisition. Such term does not include poultry.” (2) Effective date.—The amendments made by paragraph (1) shall apply to livestock acquired after December 31, 1969. (c) Exchanges of Livestock of Different Sexes.— (1) Not to be treated as like kind exchanges.—Section 1031 (relating to exchange of property held for productive use or for investment) is amended by adding at the end thereof the following new subsection: “(e) Exchanges of Livestock of Different Sexes.—For purposes of this section, livestock of different sexes are not property of a like kind.” (2) Effective date.—The amendment made by paragraph (1) shall apply to taxable years to which the Internal Revenue Code of 1954 applies.