Cooperatives—Taxation and the Law

  • Glynn McBride


Our objectives in this chapter are aimed at covering questions relating to taxation of agricultural cooperatives. This is an area that is frequently controversial and in which the cooperative is often attacked. The effort of the National Tax Equality Association is directed at what they argue is an area of unfairness by claiming that proprietary corporations are subject to double taxation while cooperative corporations’ taxing is legally handled in such a way that the cooperative pays the tax or patrons pay the tax—a single tax basis. In the case of the private corporation, the corporation pays taxes on its net margins and the stockholders pay taxes upon any dividends paid to them.


Capital Stock Private Corporation Rental Income Double Taxation Payment Period 
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  1. Baarda, J. R. 1982. State Incorporation Statutes for Farmer Cooperatives. Cooperative Information Report No. 30. Farmer Cooperative Service, United States Department of Agriculture.Google Scholar
  2. Morris, R. K. 1984. Cooperatives, The Law and Taxes. NICE, Bozeman, MT.Google Scholar
  3. U.S. Department of Agriculture, FCS. 1976. Federal Income Taxes, Legal Phases of Farmer Cooperatives, Part 2. FCS Information 100.Google Scholar
  4. U.S. Department of Agriculture, FCS. 1981. Cooperative Financing and Taxation. Cooperative Information Report 1, Section 9.Google Scholar
  5. U.S. Department of Agriculture, FCS. 1983. Antitrust Laws, Legal Phases of Farmer Cooperatives, Part 3. FCS Information 100.Google Scholar

Copyright information

© The AVI Publishing Company, Inc. 1986

Authors and Affiliations

  • Glynn McBride
    • 1
  1. 1.Department of Agricultural EconomicsMichigan State UniversityEast LansingUSA

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