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provides that such other person shall produce agricultural
commodities on such land, and that there shall be material
participation by the owner in the production or the management of
the production of such agricultural commodities, and there is
such material participation by the owner, then the rental income
received by the owner pursuant to the arrangement is considered
earnings from self-employment. Sec. 1.1402(a)-4(b), Income Tax
Regs. Such income is characterized as "includible farm rental
income". Id.
In determining whether compensation is includable in
self-employment income under sections 1401-1403 such provisions
are to be broadly construed so as to favor coverage for Social
Security purposes. Braddock v. Commissioner, 95 T.C. 639, 644
(1990). The rental exclusion in section 1402(a)(1) is to be
strictly construed to prevent this exclusion from interfering
with the congressional purpose of effectuating maximum coverage
under the Social Security umbrella. Johnson v. Commissioner, 60
T.C. 829, 832 (1973).
Petitioners contend that the oral lease agreement does not
require material participation by Mrs. Bot in the farming
operations. Petitioners further contend that the rental income
that Mrs. Bot received from Mr. Bot was rental from real estate,
and therefore should be excluded in determining whether Mrs. Bot
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