A plaintiff, Carolyn Clark, was entitled to old age social security insurance benefits only if her income from the years 1957 and 1958 constituted net earnings from self employment for social security purposes.

Ms. Clark owned two tracts of farm land that she leased to her son, Dwight Clark. One tract was 160 acres and the other tract was 60 acres. Prior to 1957, her son managed and produced crops on both tracts of land, without participation from his mother. He paid his mother regular cash rental payments for this privilege of using her farm land. Dwight also produced crops on an additional 800 acres that were not owned by his mother.

In 1956 Dwight badly injured his eye and decided to substantially cut back on his farming activities. He convinced his mother to place the 160 acre tract of land into the federal soil bank in exchange for soil bank payments from the federal government. He seeded the land with grass and it was placed in the federal soil bank. Dwight continued to farm the 60 acre tract of land and kept for himself all the crops he produced on it.

Dwight turned over his soil bank payments to his mother. He testified that he should not have been listed as tenant on the soil bank property because it was his mother who had placed the land in the soil bank. He stated that the only reason he was listed as tenant was to comply with regulations that prevented a landlord from displacing a tenant from agricultural land solely for the purpose of placing the land in the soil bank.

There was no agreement between Ms. Clark and her son that she would materially participate in the management or production on either one of the tracts of land. Her only activity with respect to the lands was to occasionally inspect the stand of grass and check the weeds.

It was held that, because Ms. Clark did not materially participate in the production or management of the lands, the soil bank payments to her were not social security wages.

See Clark v. Celebrezze, 208 F.Supp. 505 (1962). See also SSR 63-19c.

This material should not be construed as legal advice for any particular fact situation, but is intended for general informational purposes only. For advice specific to any individual situation, an experienced attorney should be contacted.