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Tax Laws and Regulations - Agriculture

Cost-share payments: Forest Land Enhancement Program (FLEP)

Rev.Rul. 2004-8 (PDF), I.R.B. 2004-10, 544 (March 8, 2004)

The IRS has ruled that the Forest Land Enhancement Program (FLEP) is substantially
similar to the type of programs described in Code Sec. 126(a)(1) through (8) within the meaning of Code Sec. 126(a)(9). Accordingly, all or a portion of cost-share payments received under the FLEP is eligible for exclusion from gross income to the extent permitted by Code Sec. 126.  The IRS notes that Code Sec. 126(b)(1) and Reg. § 16A.126-1 can be used to determine what portion, if any, of the cost-share payments is excludable from gross income under Code Sec. 126.

Exclusions from income: Cost-sharing payments: Conservation Reserve Program

Rev.Rul. 2003-59 (PDF), I.R.B. 2003-24, 1014 (June 16, 2003)

The IRS has determined that all or a portion of cost-share payments received under the Conservation Reserve Program (CRP) is eligible for exclusion from gross income to the extent permitted by Code Sec. 126.  The CRP is substantially similar to the type of programs described in Code Sec. 126(a)(1) through (8); thus, it falls within the scope of Code Sec. 126(a)(9).  However, rental payments and incentive payments made to CRP participants do not qualify as cost-share payments and, therefore, are includible in gross income.

Additional Resources

United States Tax Court
The U.S. Tax Court is a Federal court of record established by Congress under Article I of the Constitution of the United States. Here users can look up historical opinions on tax court cases.

United States Tax Code
The Legal Information Institute at Cornell University hosts the entire US Tax code. There is also a search function to quickly find relevant information.

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Page Last Reviewed or Updated: 11-Apr-2014