- 40 -
--the--my brother raised the crop. Okay? He
--having the adjacent acreage there, he raised
the crop and we effectively sharecropped that.
Okay? In other words, he’s raising the
tobacco and we’re going to split the proceeds.
I’m going to bear half the expense and that’s
what you see on the expense schedule, sir.
From petitioner’s testimony it would appear that he did not
meaningfully participate in the operations of the farming
activity, and he offered no evidence bearing on his participation
in the management of the farming activity in 1994.10
If we nevertheless assume, arguendo, that petitioners’ van is
section 179 property and that petitioner actively conducted the
farming activity as a trade or business in 1994, petitioners are
still not entitled to the deduction. They are still not entitled
to the deduction because, in their own words, it was “not properly
claimed on petitioners’ returns as filed.”
The election under section 179 “shall be made on the
taxpayer’s first income tax return for the taxable year to which
the election applies” or on an amended return filed within the
time prescribed (including extensions) for filing the return for
the taxable year. Sec. 1.179-5(a), Income Tax Regs.; see sec.
179(c)(1)(B). In addition, the election must list the total
section 179 expenses claimed for all section 179 property selected
10 Petitioner testified that his farm management activity for
1993 consisted of leasing a portion of the allotted tobacco
poundage to another farmer.
Page: Previous 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 NextLast modified: May 25, 2011