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from patronage sources, depending upon the
circumstances. Cotter & Co. v. United States,
765 F.2d 1102 (Fed. Cir. 1985); St. Louis Bank
for Coops. v. United States, 224 Ct. Cl. 289, 624
F.2d 1041 (1980); Rev. Rul. 74-160, 1974-1 C.B.
245. Dividend income has sometimes likewise been
held to be patronage-sourced. Land O'Lakes, Inc.
v. United States, 675 F.2d 988 (8th Cir. 1982);
Linnton Plywood Association v. United States, 410
F. Supp. 1100 (D. Ore. 1976); Rev. Rul. 75-228,
1975-1 C.B. 278. Rental income has also been
held to be patronage-sourced, on occasion.
Cotter & Co. v. United States, supra; Rev. Rul.
63-58, 1963-1 C.B. 109 (semble); and some capital
gains income has been held to be income from
patronage sources, under the circumstances
presented in the particular case. Astoria
Plywood Corp. v. United States, an unreported
case (D. Ore. 1979), 43 AFTR 2d 79-1114, 79-1
USTC par. 9197; contra Rev. Rul. 74-160, 1974-1
C.B. 245. [Id.]
Significantly, in the last case cited above, in response to
the Government’s argument that “all capital gains are not
patronage source income,” the court stated: “In my view,
capital gains may be patronage source income. In each
instance, it depends on whether the income is 'directly
related’ to Astoria's activities.” Astoria Plywood Corp.
v. United States, 43 AFTR 2d 79-1114, 79-1119, 79-1 USTC
par. 9197, at 86,349 (D. Or. 1979).
Moreover, the Commissioner has twice ruled that in
appropriate circumstances capital gains can be classified
as patronage income. See Rev. Rul. 74-24, 1974-1 C.B. 244;
Rev. Rul. 71-439, 1971-2 C.B. 321. Each of those rulings
involves a nonexempt cooperative engaged in the manufacture
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