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their 1987 and 1988 Federal income tax returns. Payments to
agricultural producers pursuant to the ASCS constitute taxable
income to the recipients. G.A. Stafford & Co. v. Pedrick, 171
F.2d 42 (2d Cir. 1948); Baboquivari Cattle Co. v. Commissioner,
135 F.2d 114 (9th Cir. 1943), affg. 47 B.T.A. 129 (1942); Harding
v. Commissioner, T.C. Memo. 1970-179.5
Petitioner has offered no evidence to establish that the
subject payments were not made to him or for his benefit.
Instead, petitioner has stated that he and his spouse directed
the 1987 ASCS payment of $11,198.96 to be applied to his FHA
loan. The ASCS payments fall within the broad definition of
gross income in section 61. Accordingly, we sustain respondent's
determination on this issue.
To reflect the foregoing and concessions by respondent,
Decision will be entered under
Rule 155.
5Sec. 1.61-4(a)(4), Income Tax Regs., provides that farmers
using the cash receipts and disbursements method of accounting
shall include in gross income for the taxable year "All subsidy
and conservation payments received which must be considered as
income."
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