If your livestock was used for breeding to produce inventory (raised breeding stock) and purchased livestock was treated as an asset and depreciated:
The sale of the livestock (breeding stock) are reported as the Sale of Business Property on form 4797. The sale of raised breeding stock are reported in Part 1 with zero cost basis. The sale of purchased breeding stock is reported in part 3.
If your livestock was purchased for resale the cost would be deducted in the year of sale on IRS Schedule F.
