Income From Other Sources This section discusses other types of income you may receive. Barter income.If you are paid for your work in farm products, other property, orservices, you must report as income the fair market value of what youreceive. The same rule applies if you trade farm products for otherfarm products, property, or someone else's labor. This is calledbarter income. For example, if you help a neighbor build a barn andreceive a cow for your work, you must report the fair market value ofthe cow as ordinary income. Your basis for property you receive in abarter transaction is usually the fair market value that you includein income. If you pay someone with property, see the discussion onlabor expense in chapter 5. Below-market loans.A below-market loan is a loan on which either no interest ischarged or interest is charged at a rate below the applicable federalrate. If you make a below-market loan, you may have to report incomefrom the loan in addition to any stated interest you receive from theborrower. See chapter 1 of Publication 550 for more information onbelow-market loans. Commodity futures and options.See Hedging (Commodity Futures) in chapter 10Hoteles mas baratos Stavangerforinformation on gains and losses from commodity futures and optionstransactions. Custom hire (machine work).Pay you receive for contract work or custom work that you or yourhired help perform off your farm for others, or for the use of yourproperty or machines, is income to you whether or not income tax waswithheld. This rule applies whether you receive the pay in cash,services, or merchandise. Report this income on line 9, Part I, ofSchedule F. Easements and rights-of-way.Income you receive for granting easements or rights-of-way on yourfarm or ranch for flooding land, laying pipelines, constructingelectric or telephone lines, etc., may result in income, a reductionin the basis of all or part of your farm land, or both. Example.You granted a right-of-way for a gas pipeline through your propertyfor $1,000. Only a specific part of your farm land was affected. Youreserved the right to continue farming the surface land after the pipewas laid. Treat the payment for the right-of-way in one of thefollowing ways. If the payment is less than the basis properly allocated tothe part of your land affected by the right-of-way, reduce the basisby $1,000. If the payment is more than the basis of the affected partof your land, reduce the basis to zero and the rest is gain from asale. The gain is reported on Form 4797 and is treated as section 1231gain if you held the land for more than 1 year. See chapter 11. If construction of the line damaged growing crops and you laterreceive a settlement of $250 for this damage, the $250 is income. Itdoes not affect the basis of your land. Fuel tax credit and refund.Include any credit or refund of federal excise taxes on fuels inyour gross income if you included the cost of the fuel as an expensededuction that reduced your income tax. See chapter 18for moreinformation about fuel tax credits and refunds. Illegal federal irrigation subsidy.Stockholm luxury hotelsThe federal government, operating through the Bureau ofReclamation, has made irrigation water from certain reclamation andirrigation projects available for agricultural purposes. The excess ofthe amount required to be paid for water from these projects over theamount you actually paid is an illegal subsidy. For example, if the amount required to be paid is full cost and youpaid less than full cost, the difference is an illegal subsidy and youmust include it in income. Report this on line 10 of Schedule F. Youcannot take a deduction for the amount you must include in income. For more information on reclamation and irrigation projects,contact your local Bureau of Reclamation. Prizes.Report prizes you win on farm livestock or products at contests,exhibitions, fairs, etc., on Schedule F as Other income. Ifyou receive a prize in cash, include the full amount in income. If youreceive a prize in produce or other property, include the fair marketvalue of the property. For prizes of $600 or more, you should receivea Form 1099-MISC, Miscellaneous Income. See chapter 15for information about prizes related to 4-HClub or FFA projects. See Publication 525 for information about otherprizes. Property sold, destroyed, stolen, or condemned.You may have an ordinary or capital gain if property you own issold or exchanged, stolen, destroyed by fire, flood, or othercasualty, or condemned by a public authority. In some situations, youcan postpone the tax on the gain to a later year. See chapters 10through 13. Recapture of certain depreciation.If you took a section 179 deduction for property used in yourfarming business and at any time during the property's recovery periodyou do not use it more than 50% in your business, you must includepart of the deduction in income. See chapter 8for information on thesection 179 deduction and when to recapture that deduction. In addition, if the percentage of business use of listed property(see chapter 8)falls to 50% or less in any tax year during therecovery period, you must include in income any excess depreciationyou took on the property. Both of these amounts are farm income. Use Part IV of Form 4797 tofigure how much to include in income. Refund or reimbursement.You must generally include in income a reimbursement, refund, orrecovery of an item for which you took a deduction in an earlier year.Include it for the tax year you receive it. However, if any part ofthe earlier deduction did not decrease your income tax, you do nothave to include that part of the reimbursement, refund, or recovery. Example.A tenant farmer purchased fertilizer for $1,000 in April 1999. Hededucted $1,000 on his 1999 Schedule F and the entire deductionreduced his tax. The landowner reimbursed him $500 of the cost of thefertilizer in February 2000. The tenant farmer must include $500 inincome on his 2000 tax return because the entire deduction decreasedhis 1999 tax. Sale of soil and other natural deposits.If you remove and sell topsoil, loam, fill dirt, sand, gravel, orother natural deposits from your property, the proceeds are ordinaryincome. A reasonable allowance for depletion of the natural depositsold may be claimed as a deduction. See Depletion inchapter 8. Sod.Report proceeds from the sale of sod on Schedule F. A deduction forcost depletion is allowed, but only for the topsoil removed with thesod. Granting the right to remove deposits.If you enter into a legal relationship granting someone else theright to excavate and remove natural deposits from your property, youmust determine whether the transaction is a sale or another type oftransaction (for example, a lease). If you receive a specified sum or an amount fixed without regard tothe quantity produced and sold from the deposit and you retain noeconomic interest in the deposit, your transaction is a sale. You areconsidered to retain an economic interest if, under the terms of thelegal relationship, you depend on the income derived from extractionof the deposit for a return of your capital investment in the deposit. Your income from the deposit is capital gain if the transaction isa sale. Otherwise, it is ordinary income subject to an allowance fordepletion. See chapter 8for information on depletion and chapter 10for the tax treatment of capital gains. Timber sales.Timber sales, including sales of logs, firewood, and pulpwood, arediscussed in chapter 10.