"Actively Engaged in Farming"

I was in the FSA website, trying to find data on corn prices. (It used to be there, but they've revamped the site and their PDF documents and I can't find it so I had to revert to Google.) But while I was there I ran across this fact sheet on the Administration's proposal for capping payments to producers with over $200,000 in "adjusted gross income". (I've an alternate proposal.) (Background, Senator Chambliss in the Senate Ag hearings took Johanns over the coals on the proposal, talking about farmers who had to pay off their equipment. This fact sheet explains there are 25 categories of deductions from income to arrive at AGI. It doesn't say that Chambliss was wrong, but I infer it.)

According to the IRS, 38,000 filers had AGI over $200 K and received farm payments.

"These 38,000 tax filers received 4.9 percent of all farm program payments or approximately $400 million.

The 38,000 tax filers who had an AGI of $200,000 or more and received farm program payments in 2004 includes both Schedule F filers and Form 4835 filers. Schedule F is filed by farm proprietors. Of all Schedule F filers, only 1.2 percent, or 25,000, had an AGI of $200,000 or more and received farm program payments.

Form 4835 is used by tax filers who don't materially participate in running a farm to report farm rental income or expenses. Of all Form 4835 filers, only 2 percent, or 13,000, had an AGI of $200,000 or more and received farm program payments in 2004."

What's not noted is that IRS and FSA have different definitions of "farming". If I understand correctly, IRS doesn't consider Form 4835 filers to be "farmers". But FSA does, under the permissive definition of "actively engaged".