SSA logo: link to Social Security Online home1222. How is material participation established in a farm rental arrangement?

The farm rental arrangement must state that you will materially participate in the production of the farm commodities. The arrangement may be in writing or it may be oral, but should reflect the mutual understanding between you and your tenant. If the agreement is oral, you must be able to prove that it provides for your material participation. The written agreement or lease may not cover all the details of the understanding between you and the tenant. If the written agreement is supplemented by an oral agreement, material participation may be established if you actually participated in line with the oral agreement.

Last Revised: Aug. 25, 2009