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represented himself as the grower or owner of corn. Mr. Fultz
was personally obligated to MCP and personally benefited from his
agreements with MCP through the receipt of payments from MCP.
Petitioners’ position presents an argument analogous to the
taxpayers’ argument in Bot v. Commissioner, supra. The Bots
argued that their intent in purchasing the MCP equity units was
to make an investment; they reasoned that this subjective intent
prevented the application of the self-employment tax to the
proceeds received from MCP. This Court and the Court of Appeals
for the Eighth Circuit rejected this argument. The Court of
Appeals explained why the Bots’ argument failed:
Despite their assertions that they bought the units of
participation as an investment, the program operated on
the basis that they were producers or owners of the
corn delivered under the program and that MCP acted as
their agent in further processing and marketing the
corn. The Bots should be held to their
representations. If they want the benefits of the coop
program, they must bear the burdens as well. Cf.
Estate of Bean v. Comm’r., 268 F.3d 553, 557 (8th Cir.
2001) (“Once chosen, the taxpayers are bound by the
consequences of the transaction as structured, even if
hindsight reveals a more favorable tax treatment.”).
Bot v. Commissioner, 353 F.3d at 601-602. This reasoning applies
to petitioners’ assertion that they assigned their rights under
the MCP agreements to Fultz Farms because petitioners’ purported
assignment did not bind MCP. Fultz Farms did not own any stock
in MCP, was not a member of MCP, and would not have been able to
contract with MCP for the delivery of the corn. MCP paid Mr.
Fultz, not Fultz Farms, as the grower or owner of the corn, and
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