Is this taxable income? How to report?

[artp]

New client is farm landlord (not active in farming operations) who receives a share of the crop sales as rent for his farm land. He received a 1099-PATR from the cooperative showing $298.81 in box 1 (patronage dividends), $10,014.70 in box 3 (per unit retain allocations), $10,313.51 in box 7 (qualified payments Sec 199A) and $10,313.51 in box 8 ( Sec 199A items). In the past he only reported his share of the crop sales as income and the patronage dividends in box 1 on Form 4835 with the amounts shown on that form carrying over to Sch E. Since he is not active farmer does he have to report any of the amounts in boxes 3, 7,8 ? HIs net income on Form 4835 has either been very small or even a loss so he has never tried to claim QBI in profit years. I would appreciate help from those who have experience with farm rentals where client is getting a 1099-PATR like this,

[Lion EA]

You got your answer from the other board where you posted, right?

[DANRVAN]

1 hour ago, artp said:

$298.81 in box 1 (patronage dividends), $10,014.70 in box 3

You need to report these on line 2 of form 4835 or your client will receive a CP 2000.  Box 3 is the gross crop sales to the coop.  Most likely you will need to deduct storage....etc cost to reflect his net payment.

 

1 hour ago, artp said:

does he have to report any of the amounts in boxes 3, 7,8 ?

It might be to his advantage.

[artp]

DANRVAN

 

Thanks for the quick reply, much appreciated. Just to clarify, client is reporting this activity thru a trust so there is no Form 4835 available and everything is reported on SCH E. The net crop sales per his listing is $9602.76. The difference of $411.94 is discounts and check off charges.

[Abby Normal]

So when you said he received a 1099PATR you really meant that the trust received a 1099PATR? And he got a K1 from the trust?

[artp]

The property is held in the trust so the trust received the 1099PATR.  Sorry for the confustion.