USDA’s Farm Service Agency (FSA) is expanding payment limitation and eligibility provisions that affect program payments.
The update will allow for the equitable treatment of business entities, along with an increased payment limitation for certain programs and a broader definition of farming income.
“The 2026 program year will be a monumental change for farmers and ranchers who can now structure their farm entities to benefit from the legal protections of certain business structures without limiting their access to the farm safety net,” said Bill Beam, FSA administrator.
The changes were included in the Working Families Tax Cuts Act signed into law last summer.
Beginning with the 2026 crop year, FSA will treat applicable LLCs, S-Corporations and other similar entities as “pass through entities.”
Starting with crop year 2025, the Agriculture Risk Coverage and Price Loss Coverage programs’ payment limit will increase from $125,000 to $155,000.
Producers are also exempt from the $900,000 average adjusted gross income cap for conservation and disaster programs if at least 75% of their average gross income is from farming, ranching or silviculture, which now includes agritourism, direct-to-consumer sales and certain equipment sales.
