~~The IRS has tried to assess self-employment tax on receipt of Conservation Reserve Program (CRP) payments even if the taxpayer was not a farmer. Roger McEowen at his Agricultural Law and Taxation Blog reviews a recent IRS audit where they did not assess SE tax on CRP payments for a non-farmer.
Also, if a farmer makes the de minimis election to expense all items costing less than $2,500, the later sale of these items were assumed to be subject to self-employment tax. However, in an informal communication from the IRS; they state that the sale of breeding stock that was expensed under the de minimis election is not subject to SE tax. Instead it is reported on Form 4797 and just treated as ordinary income.
However, this letter stresses this is a fact-by-fact case. Roger explains some additional nuances for each situation.