Rents (Including Crop Shares) The rent you receive for the use of your farm land is generallyrental income, not farm income. However, if you materially participatein farming operations on the land, the rent is farm income. SeeBlackpool hotelsLandlord Participation in Farming in chapter 15. Pasture income and rental.If you pasture someone else's cattle and take care of the livestockfor a fee, the income is from your farming business. You must enter itas Other income on Schedule F. If you simply rent yourpasture for a flat cash amount without providing services, report theincome as rent in Part I of Schedule E (Form 1040). Crop Shares You must include rent you receive in the form of crop shares inincome in the year you convert the shares to money or the equivalentof money. It does not matter whether you use the cash method ofaccounting or an accrual method of accounting. If you materiallyparticipate in operating a farm from which you receive rent in theform of crop shares or livestock, the rental income is subject toself-employment tax. (See Landlord Participation in Farmingin chapter 15.)Report the rental income on Schedule F. Munich luxury hotelsIf you do not materially participate in operating the farm, reportthis income on Form 4835 and carry the net income or loss to ScheduleE (Form 1040). The income is not subject to self-employment tax. Crop shares you use to feed livestock.Crop shares you receive as a landlord and feed to your livestockare considered converted to money when fed to the livestock. You mustinclude the fair market value of the crop shares in income at thattime. You are entitled to a business expense deduction for thelivestock feed in the same amount and at the same time you include thefair market value of the crop share as rental income. Although thesetwo transactions would cancel each other for figuring adjusted grossincome on Form 1040, they may be necessary to figure yourself-employment tax. See chapter 15. Crop shares you give to others (gift).Crop shares you receive as a landlord and give to others areconsidered converted to money when you make the gift. You must reportthe fair market value of the crop share as income, even though someoneelse receives payment for the crop share. Example.ricerca albergo BudardalurA tenant farmed part of your land under a crop-share arrangement.The tenant harvested and delivered the crop in your name to anelevator company. Before selling any of the crop, you instructed theelevator company to cancel your warehouse receipt and make out newwarehouse receipts in equal amounts of the crop in the names of yourchildren. They sell their crop shares in the following year and theelevator company makes payments directly to your children. In this situation, you are considered to have received rentalincome and then made a gift of that income. You must include the fairmarket value of the crop shares in your income for the tax year yougave the crop shares to your children. Crop share loss.If you are involved in a rental or crop-share lease arrangement,any loss from these activities may be subject to the limits under thepassive loss rules. See Publication 925for information on theserules.