Vincent E. & Judy Bot - Page 9

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          Petitioners admitted that in addition to farrowing and other                
          activities concerning their swine, Mrs. Bot operated farm                   
          machinery, harvested and bailed crops, and picked up supplies on            
          a semiweekly basis.  As noted, Mrs. Bot worked on the farm                  
          approximately 1,862 hours per year.  We deem it immaterial that             
          Mrs. Bot also purportedly was paid a salary for her services with           
          a corresponding deduction taken on their tax returns.  In our               
          view, these "regularly performed services are material to the               
          production of an agricultural commodity, and the intermittent               
          services performed are material to the production operations to             
          which they relate."  Sec. 1.1402(a)-4(b)(6) Example (1), Income             
          Tax Regs.                                                                   
               The regulations provide in pertinent part, that if the                 
          rental income is derived under an arrangement between the owner             
          of land and another person which 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.                     
          Accordingly, we find that the rental income is includable farm              
          rental income that is part of Mrs. Bot's net earnings from self-            

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