- 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