Is this a partnership?

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  • RWG1950
    Senior Member
    • Nov 2017
    • 462

    #1

    Is this a partnership?

    My customer's mother died in 2022, leaving the family farm in equal shares (17 acres each) among her 8 children, one of which continues to operate the farm, renting the land from each of the other 7. None of the 7 are involved in the farming activities, or sharing in any farm profit or loss - just renting the land to their sibling. My customer brought in a 2022 1099-MISC for $2,800 for her share of the land rental, which I'll put on an "E" and also list her share of the property taxes paid as rental expenses. I was wondering if the IRS would deem this arrangement to be a partnership - or is it OK as is?
    Thanks for comments.



  • Lion
    Senior Member
    • Jun 2005
    • 4699

    #2
    From the Partnership instructions: A joint undertaking merely to share expenses isn't a partnership. Mere co-ownership of property that is maintained and leased or rented isn't a partnership. However, if the co-owners provide services to the tenants, a partnership exists.

    Comment

    • ToledoEd
      Senior Member
      • Jan 2010
      • 134

      #3
      I think you would use a Form 4835, not a Schedule E for the Farm land rental income.

      Comment

      • TaxmannEA
        Member
        • Apr 2007
        • 76

        #4
        If it's cash rent, then use Sch. E. Use 4835 if you're dealing with a crop-share rent arrangement.

        Comment

        • Twin Turbo Z
          Senior Member
          • Feb 2014
          • 373

          #5
          Yes to Schedule E.

          Comment

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