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taxpayer-spouses, which provided that those spouses were to
produce agricultural commodities on that land and that the
taxpayer-owners were to participate materially in the production
of such commodities. We held in Bot I and Hennen I that the
rents at issue in those cases, reduced by the deductions attrib-
utable to such respective rents, were subject to self-employment
tax because they constituted includible farm rental income under
section 1402(a)(1).
In McNamara I, the taxpayer-owners of the farmland in
question contended that the rental agreement or arrangement
involved in that case did not require their material participa-
tion in the production of the agricultural commodities in ques-
tion. We found that the taxpayer-owners played a material role
in the production of such commodities under an agreement or
arrangement with their wholly owned corporation. We further
found in McNamara I that the income received from the rental of
the taxpayers’ farmland in question was derived under an arrange-
ment between the taxpayer-owners and their wholly owned corpora-
tion, which provided that that corporation was to produce agri-
cultural commodities on that land and that the taxpayer-owners
were to participate materially in the production of such commodi-
ties. We held in McNamara I that the rent at issue in that case,
reduced by the deductions attributable to such rents, was subject
to self-employment tax because it constituted includible farm
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