[Agriculture Fact Book 98]

Legal Structure of U.S. Farms (Individual, Partnership, Corporation)

Type of organization refers to the farm’s form of business organization. Farms may broadly be classified as individual operations (proprietorships), partnerships, or corporations (family and nonfamily). Agricultural Resource Management Study data indicate that individual operations are the most common type of farm organization. Nine out of ten farms in the 1996 survey were classified as individual operations. Partnerships and corporations make up a very small share of farms. About 89 percent of farm corporations are family corporations, with more than 50 percent of the stock held by people related by blood or marriage.

Individual operations account for the largest share of farmland (71 percent) and gross farm sales (74 percent). Corporate farms have the highest average farm sales. The average value of gross farm sales by corporate farms in 1996 was $246,826, while partnerships averaged $201,205. Gross sales for individual operations averaged $63,159, about one-quarter of the corporate level. Average acreage was also higher for corporate farms (1,165 acres) and for partnerships (856 acres) than for individual operations (373 acres).

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