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Title 7 Part 1400 → Subpart G → §1400.601

Title 7 → Subtitle B → Chapter XIV → Subchapter A → Part 1400 → Subpart G → §1400.601

Electronic Code of Federal Regulations e-CFR

§1400.601   Definitions.

(a) The terms defined in §1400.3 are applicable to this subpart and all documents issued in accordance with this part, except as otherwise provided in this section.

(b) The following definitions are also applicable to this subpart:

Active personal management means personally providing and participating in management activities considered critical to the profitability of the farming operation and performed under one or more of the following categories:

(i) Capital, which includes:

(A) Arranging financing and managing capital;

(B) Acquiring equipment;

(C) Acquiring land and negotiating leases;

(D) Managing insurance; and

(E) Managing participation in USDA programs;

(ii) Labor, which includes hiring and managing of hired labor; and

(iii) Agronomics and marketing, which includes:

(A) Selecting crops and making planting decisions;

(B) Acquiring and purchasing crop inputs;

(C) Managing crops (that is, whatever managerial decisions are needed with respect to keeping the growing crops living and healthy—soil fertility and fertilization, weed control, insect control, irrigation if applicable) and making harvest decisions; and

(D) Pricing and marketing of crop production.

Significant contribution of active personal management means active personal management activities performed by a person, with a direct or indirect ownership interest in the farming operation, on a regular, continuous, and substantial basis to the farming operation, and meets at least one of the following to be considered significant:

(i) Performs at least 25 percent of the total management hours required for the farming operation on an annual basis; or

(ii) Performs at least 500 hours of management annually for the farming operation.

Significant contribution of the combination of active personal labor and active personal management means a contribution of a combination of active personal labor and active personal management that:

(i) Is critical to the profitability of the farming operation;

(ii) Is performed on a regular, continuous, and substantial basis; and

(iii) Meets the following required number of hours:

Combination of Active Personal Labor and Active Personal Management Minimum Requirement for a Significant Contribution

[In hours]

Management contribution in hoursLabor contribution in hoursMeets the minimum threshold for significant contribution, in hours
47575550
450100550
425225650
400250650
375375750
350400750
325425750
300550850
275575850
250600850
225625850
200650850
175675850
150800950
125825950
100850950
75875950
50900950
25925950