In general, wages paid in kind rather than in cash to agricultural labor are not subject to FICA or FUTA taxes. In addition, agricultural labor is exempt from income tax withholding except as the payment constitutes "wages." Wages paid "in any medium other than cash for agricultural labor" are exempt from the term "wages."

Recent rulings (and apparent Internal Revenue Service scrutiny of the practice) have focused attention on the issue although neither the practice of paying wages in kind nor the authority for unique tax treatment of such in kind payments is new.