Burnett Ranches, Ltd. v. United States

The government appealed the district court's Final Judgment which rejected the government's efforts to tax Burnett Ranches as a "farming syndicate" tax shelter per I.R.C. 464. The court agreed with the district court that an otherwise qualified individual who has participated in management of the farming operation for not less than five years comes within the Active Participation Exception in section 464(c)(2)(A), irrespective of the fact that the legal title of such individual's attributable interest happens to be held in the name of her wholly owned S corp. rather than in her own name. Accordingly, the court affirmed the district court's lift of the stay of its earlier ruling and made final judgment in favor of Burnett Ranches. View "Burnett Ranches, Ltd. v. United States" on Justia Law