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The parties agree that during the years at issue petitioners
were to, and did, participate materially within the meaning of
section 1402(a)(1) in the production by G.E. Johnson, Inc., of
agricultural commodities by performing petitioners’ farm-related
activities. They disagree over whether the 1993 claimed rent,
the 1994 claimed rent, and the modified 1995 claimed rent were
derived under an arrangement within the meaning of section
1402(a)(1)(A) and section 1.1402(a)-4(b)(2), Income Tax Regs.,
between petitioners and G.E. Johnson, Inc., which provided or
contemplated that G.E. Johnson, Inc., was to produce agricultural
commodities on petitioners’ land and that petitioners were to
participate materially in the production of such commodities.
It is petitioners’ position that the claimed rents at issue
were not derived under such an arrangement and that consequently
such claimed rents, reduced by the deductions attributable to
such respective rents, are not subject to self-employment tax
because they do not constitute includible farm rental income
under section 1402(a)(1) and the regulations thereunder. In
support of their position, petitioners rely on the opinion of the
Court of Appeals for the Eighth Circuit in McNamara v. Commis-
sioner, 236 F.3d 410 (8th Cir. 2000), revg. and remanding Bot v.
Commissioner, T.C. Memo. 1999-256, Hennen v. Commissioner, T.C.
Memo. 1999-306, and McNamara v. Commissioner, T.C. Memo. 1999-
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