FARM BUSINESS NEWS
Farm Investors Hit
Marcia Zarley Taylor DTN Executive Editor
Fri Jun 21, 2013 10:46 AM CDT

HADDONFIELD, N. J. (DTN) -- In a surprise reversal of tax policy, the U.S. Tax Court ruled this week that Conservation Reserve Program payments don't equate to cash rent, so even nonfarm landowners who live out of state owe self-employment taxes on such income.

The decision shocked legal scholars and agricultural accountants who for most of the past three decades have advised farm investors that they were exempt from the 15.3% tax if they were not otherwise actively engaged in an agricultural business.

"This is a pretty unfortunate case," said Roger McEowen, an Iowa State University law professor. He believed ...

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