- 23 -
Graves v. Commissioner, 89 T.C. 49, 51 (1987), supplementing 88
T.C. 28 (1987)).
Respondent contends that petitioner realized $31,238 in
gross income as a result of the FmHA’s discharge of petitioner’s
indebtedness during 1990. Respondent does not dispute, for
purposes of the section 108(a)(1)(C) exclusion, (1) that the FmHA
is a qualified person, see sec. 108(g)(1); (2) that petitioner’s
indebtedness was incurred directly in connection with
petitioner’s operation of the trade or business of farming, see
sec. 108(g)(2)(A); or (3) that petitioner was solvent, see sec.
108(a)(2)(B). Respondent argues, however, that petitioner fails
to satisfy the test in section 108(g)(2)(B). See Lawinger v.
Commissioner, 103 T.C. 428 (1994).
Petitioner testified that for 1987, 1988, and 1989 he earned
gross income of approximately $250 per acre multiplied by 270
acres of farmed land, totaling approximately $65,000 per year.
According to petitioner, he earned “somewhere in the neighborhood
of around $250 an acre for corn” and “just a little less than
that” for soybeans. On cross-examination, however, petitioner
testified that only 110 acres of that land were “under the
irrigator” and the remaining acres were not producing.
Petitioner testified further that he kept annual production
records as required by the FmHA in order to borrow money but that
he could not produce these records at trial because the FmHA had
Page: Previous 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 NextLast modified: May 25, 2011