USDA Streamlines Farm Payment Limits

As part of the announcement, USDA has finalized a Memorandum of Understanding with the IRS to establish an electronic information exchange process for verifying compliance with the adjusted gross income provisions for programs administered by USDA's Farm Service Agency (FSA) and Natural Resources Conservation Service (NRCS). This agreement will ensure that payments are not issued to producers whose adjusted gross income (AGI) exceeds certain limits. The limits set in the 2008 Farm Bill are $500,000 non-farm average AGI for commodity and disaster programs; $750,000 farm average AGI for direct payments; and $1 million non-farm average AGI for conservation programs. Meanwhile, beginning with the 2010 program year, USDA has amended the rules that govern the requirements to be 'actively engaged' in farming. These rules apply to eligibility for payments under the Direct and Counter-cyclical Program (DCP) or Average Crop Revenue Election (ACRE) program administered by FSA.