Flexible-Cash Crop Lease Agreement printable pdf download

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Flexible-Cash Crop Lease Agreements

What Is A Flexible-Cash Lease Agreement?

A lease is basically an agreement that gives

Quick Notes...

the use of an asset to a lessee for a specific

period of time at a specified rate. A lease

The tenant produces crops on the land and

does not transfer title of owner- ship nor an

makes general management decisions as if

equity interest in the asset.

the land were owned by the tenant.

Labeling a document as a lease does not

Flexible-cash lease agreements involve the

necessarily mean it is a lease according to the

tenant paying the landowner a predetermined

Internal Revenue Service (IRS). Questions

cash fee adjusted for changes in prices and/or

concerning the IRS treatment of a lease should

yields.

be addressed by your tax management

professional. Also, the legalities of the lease

The landowner has increased opportunities to

should be addressed by professional legal

share in additional income under a flexible-

counsel.

cash lease agreement when compared to a

fixed-cash agreement.

A flexible-cash lease agreement is a rental

arrangement in which the landowner receives

a predetermined cash fee from the tenant

The types of land lease agreements vary

adjusted for changes in prices and/or yields.

widely in each locality and from one farming

The tenant produces crops on the land and

area to another, and are often based on long-

makes general management decisions as if the

standing traditions. Landowners and tenants

land were owned by the tenant.

can choose from three primary types of lease

agreements for crop production: crop share,

Advantages of a flexible-cash lease agreement

fixed-cash, or flexible-cash agreements.

over other types of agreements include:

The purpose of this publication is to help

The landowner has opportunities to

landowners and tenants make informed

share in the additional income

decisions and to develop "fair" flexible-

resulting from unexpected increases in

cash lease agreements concerning crop

crop prices and extra-normal yields.

production. A sample flexible-cash lease

agreement can be found at the end of this

document.

Colorado State University, U.S. Department of Agriculture and Colorado counties cooperating.

Extension programs are available to all without discrimination.

No endorsement of products is intended nor is criticism of products mentioned.

Flexible-Cash Crop Lease Agreement

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