- 5 -
had paid, and calculated how much of the farm operation’s profit
they each were entitled to receive.
With the exception of proceeds generated from the sale of
corn in 1995 that were reported as proceeds from the sale of
capital assets on Schedule D, Capital Gains and Losses,
petitioners reported their share of farm income and expenses as
farm rental income and expenses on Forms 4835, Farm Rental Income
and Expenses, attached to their 1994 and 1995 Forms 1040, U.S.
Individual Income Tax Return.
Minnesota Corn Processors
In approximately 1982, a group of Minnesota farmers formed
Minnesota Corn Processors (MCP), an agricultural cooperative
organized under the laws of Minnesota.4 MCP was incorporated to
handle all aspects of dealing with agricultural products produced
by its members and to perform services for its members.
Under its articles of incorporation, MCP was authorized to
issue 30,000 shares of common stock and 100,000 shares of
nonvoting preferred stock. Only “producers of agricultural
products * * * who reside in the territory served” by MCP could
hold shares. A producer is any person “actually engaged in the
4MCP’s objective was to accomplish collectively what none of
its members could accomplish individually–-process corn and
realize profits from the increased value of that processed corn.
Without MCP’s pooled funds and processing facilities, its members
would have had to sell their corn, if any, to an elevator. Then,
any value added to the corn by processing the corn would have
been realized by others.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011