General Instructions

Section references are to the Internal Revenue Code unless otherwise noted. Future developments. For the latest information about developments related to Form 4835 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/Form4835 .

Purpose of Form

If you were the landowner (or sub-lessor) and did not materially participate (for self-employment tax purposes) in the operation or management of the farm, use Form 4835 to report farm rental income based on crops or livestock produced by the tenant. See chapter 12 in Pub. 225, Farmer’s Tax Guide, for the definition of “material participation” for landlords.

Use this form only if the activity was a rental activity for purposes of the passive activity loss limitations. See the Instructions for Form 8582, Passive Activity Loss Limitations, for the definition of “rental activity.”

If you have net income on line 32, your tax may be less if you figure it using Schedule J (Form 1040).

Do not use Form 4835 if you were a/an:

• Tenant—instead use Schedule F (Form 1040) to report farm income and expenses;

• Landowner (or sub-lessor) and materially participated in the operation or management of the farm—instead use Schedule F (Form 1040) to report farm income and expenses;

• Landowner (or sub-lessor) and received cash rent for pasture or farmland based on a flat charge—instead report as income on Schedule E (Form 1040), Part I;

• Estate or trust with rental income and expenses from crop and livestock shares—instead report on Schedule E (Form 1040), Part I; or

• Partnership or S corporation with rental income and expenses from crop and livestock shares—instead report on Form 8825. Qualified joint ventures. If you and your spouse each materially participated as the only members of a jointly owned and operated farm rental business, and you filed a joint return for the tax year, you can make an election to be taxed as a qualified joint venture instead of a partnership. This election in most cases will not increase the total tax owed on the joint return, but it does give each of you credit for social security earnings on which retirement benefits are based and for Medicare coverage without filing a partnership return.

If you and your spouse make the election and you didn’t materially participate (for self-employment tax purposes) in the operation or management of the farm, but maintained the farm as a rental business, you each can file a separate Form 4835 to report your share of farm rental income based on crops or livestock produced by the tenant. If you and your spouse did materially participate (for self-employment tax purposes) in the operation or management of the farm, you each must file a separate Schedule F (Form 1040). For an explanation of

“material participation,” see the instructions for Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship), line G. For more information on qualified joint ventures, go to www.irs.gov/QJV . Additional information. See the Instructions for Schedule F (Form 1040), Profit or Loss From Farming, and Pub. 225 for more information.