- 7 -
Discussion
The relevant provisions of section 175 are as follows:
SEC. 175. SOIL AND WATER CONSERVATION EXPENDITURES.
(a) In general.--A taxpayer engaged in the business of
farming may treat expenditures which are paid or incurred by
him during the taxable year for the purpose of soil or water
conservation in respect of land used in farming, or for the
prevention of erosion of land used in farming, as expenses
which are not chargeable to capital account. The
expenditures so treated shall be allowed as a deduction.
** * * * * * *
(c) Definitions.--For purposes of subsection(a)--
* * * * * * *
(3) Additional limitations.--
(A) Expenditures must be
consistent with soil conservation plan.
--Notwithstanding any other provision of
this section, subsection (a) shall not
apply to any expenditures unless such
expenditures are consistent with--
(i) the plan (if any)
approved by the Soil Conservation
Service of the Department of
Agriculture for the area in which
the land is located, or
(ii) if there is no plan
described in clause (i), any soil
conservation plan of a comparable
State agency.
Until 1954, the resolution of the question of the treatment
for tax purposes of the expenditures made by farmers to improve
their land required a highly fact-intensive inquiry. Compare,
e.g., Collingwood v. Commissioner, 20 T.C. 937 (1953)
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011