1120.“Undertakes to Produce a Crop” Defined for Sharefarming Arrangements
1120.1What is a sharefarming arrangement?
A “sharefarming arrangement” is one in which the sharefarmer performs the labor for production of the crop. It is not one in which the landowner agrees to participate in the day-to-day physical labor in the production of the crop or livestock.
1120.2What does undertakes to produce a crop mean?
The phrase “undertakes to produce a crop or livestock” means performing or assuming the responsibility for performing substantially all the physical labor involved in producing of the farm product.
1120.3What activities are included under this definition?
Generally, this means that the tenant has the responsibility for caring for the crop from the beginning up to and including harvesting. In some circumstances, it may not include planting of the crop. For example, in fruit raising operations, the planting of fruit trees, bushes, or plants may have been done by the landowner in a prior year. This would not alter the relationship of the parties to a sharefarming arrangement with regard to the fruit crop.
1120.4If the landowner harvests or sells the crop, does the sharefarming arrangement remain?
The landowner may sometimes harvest or sell the crop produced. If the person who produced a crop has the responsibility for planting, raising, and caring for the crop or livestock during substantially all of the growing period, the element of a sharefarming arrangement is still met.
1120.5What activities are excluded from producing a crop or livestock?
Producing a crop or livestock does not include such specialized activities as custom sheep shearing, custom harvesting, dusting, or custom cultivating.