Rev. Rul. 70-112 1, 1970-1 CB 207

REV-RUL, Agricultural labor., Rev. Rul. 70-112¹, 1970-1 CB 207, (Jan. 01, 1970)

Section 3121.--Definitions

26 CFR 31.3121(g)-1: Agricultural labor.
(Also Sections 3306, 3401; 31.3306(k)-1, 31.3401(a)(2)-1.)
Services performed for a farm owner in cutting, sawing, and hauling logs to market in clearing timberland for use as an orchard are not "agricultural labor"; however, services performed after the felled timber has been removed are "agricultural labor"; S.S.T. 289 superseded.

The purpose of this Revenue Ruling is to update and restate, under the current statute and regulations, the position set forth in S.S.T. 289, C.B. 1938-1, 431.

The question presented is whether services performed for an individual in the clearing of timberland for use as an orchard are "agricultural labor" for purposes of the Federal Insurance Contributions Act, the Federal Unemployment Tax Act, and the Collection of Income Tax at Source on Wages (chapters 21, 23, and 24, respectively, subtitle C, Internal Revenue Code of 1954).

The individual owns a farm, a considerable part of which is timberland. In the course of preparing the timberland for use as an orchard he has hired employees to clear it of timber. The trees are cut, sawed into logs, and hauled to market, where they are sold. After the timber is removed the land will be cleared of stumps, underbrush, and debris for use as an orchard.

Section 3121(g)(1) of chapter 21 of the Code provides, in part, that the term "agricultural labor" includes all service performed "on a farm, in the employ of any person, in connection with cultivating the soil, or in connection with raising or harvesting any agricultural or horticultural commodity, * * *." Section 3306(k)(1) of chapter 23 of the Code provides a similar definition of the term "agricultural labor" and section 3401(a)(2), chapter 24 of the Code, provides that for purposes of that chapter the term "wages" shall not include remuneration paid for agricultural labor as that term is defined in section 3121(g).

Section 31.3121(g)-1 of the Employment Tax Regulations provides that, in general, the term "agricultural labor" does not include services performed in connection with forestry, lumbering, or landscaping.

It is held that services performed by the employees of the farm owner in cutting, sawing, and hauling the logs to market are not "agricultural labor" for purposes of sections 3121(g), 3306(k)(1), and 3401(a)(2) of chapters 21, 23, and 24, respectively, of the Code. However, services performed by the employees in the clearing of stumps, underbrush, and debris from the land in preparing it for use as an orchard after the felled timber has been removed are "agricultural labor" for purposes of chapters 21, 23, and 24 of the Code.

S.S.T. 289 is superseded, since the position set forth therein is restated under current law in this Revenue Ruling.

1 Prepared pursuant to Rev. Proc. 67-6, C.B. 1967-1, 576.