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2014 Farm Bill Implementation: Payment & AGI Limits

14:45PM Apr 16, 2014

via a special arrangement with Informa Economics, Inc.

FSA offices receiving updates on changes brought about by 2014 Farm Bill

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

USDA has begun to disseminate information on changes to payment limits and adjusted gross income (AGI) limitations for farm program participation eligibility contained in the 2014 Farm Bill.

While noting that the "majority of the rules and requirements" that have been in effect under the 2008 Farm Bill are still in place for the 2014 Farm Bill, some components have changed due to the new farm bill. Those that have not changed include requirements of actively engaged in farming, cash-rent tenant, substantive change, minor child, and spousal provisions. Payments will continue to be limited by direct attribution to person and legal entity.

On actively engaged requirements, FSA said the following are still required:

  • a significant contribution of:

  • capital, land, equipment, or a combination thereof

  • active person labor, active personal management, or a combination thereof

  • that contributions be commensurate with the claimed share of the profit or loss of the farming operation

  • the contributions to be at risk for a loss.

In addition, FSA reminds that each partner, stockholder, or member must make a contribution of active personal labor and/or active personal management to the farming operation that must be:

  • performed on a regular basis

  • identifiable and documentable

  • separate and distinct from contributions of any other partner, stockholder, or member of the farming operation.

However, FSA notes, "Exceptions may apply for spouses, minor children, and certain types of legal entities."

AGI Changes

Under the 2014 Farm Bill, there is now a three-year average AGI of $900,000 or less to receive commodity, price support and disaster assistance program payment and benefits. For 2015, FSA noted that the same AGI limitation will then apply to recipients of payments and benefits from most conservation programs.

If the three-year average AGI is over $900,000, the person or legal entity will be ineligible for payments and benefits under the following programs:

  • October 1, 2011, and subsequent years: Livestock Indemnity Program (LIP), Emergency Assistance for Livestock, Honeybees, and Farm-Raised Fish Program (ELAP), Livestock Forage Disaster Program (LFP) and Tree Assistance Program (TAP)

  • 2014 and subsequent years: NAP

  • 2014 through 2018: Agricultural Management Assistance (AMA), Ag Risk Coverage (ARC), loan deficiency payments (LDPs) marketing loan gain (MLG), Price Loss Coverage (PLC),

  • 2014 and 2015 only: Transition assistance for producers of upland cotton

  • 2015 and subsequent years: Agricultural Conservation Easement Program (ACEP), Conservation of Private Grazing Land Program (CPGLP), Conservation Stewardship Program (CSP), Conservation Reserve Program (CRP), Environmental Quality Incentives Program (EQIP), Farmable Wetland Program (FWP), Grassroots Source Water Protection Program (GSWPP), Regional Conservation Partnership Program (RCPP), and Voluntary Public Access and Habitat Incentive Program (VPAHIP).

A new form is also required for the verification process, as FSA Form CCC-941 will have to be completed by any person or legal entity, and all interest holders to the fourth level ownership, that request program payments and benefits under the 2014 Farm Bill. The form is also year specific for the program year for which benefits are requested.

The following table shows payment limits that will be in effect for various programs over the 2014 through 2018 crop year:

Program Payment Type

Annual Limitation, Unless Otherwise Noted, 2014 Through 2018 Per Person or Legal Entity

Commodity and Price Support Programs

ARC, PLC, LDP, and MLG payments for other than peanuts


ARC, PLC, LDP, and MLG payments for peanuts


Transition assistance for producer of upland cotton

$40,000 1/

Conservation Programs


$50,000 5/

CRP annual rental payment and incentive payment

$50,000 2/


$200,000 3/

ECP, per disaster event


EFRP, per disaster event



$450,000 4/

Disaster Assistance Programs


$125,000 6/





Other Programs

Trade Adjustment Assistance for Farmers


1/ Transition assistance for producers of upland cotton is only available in 2014 and 2015 program years.

2/ CRP contracts approved before October 1, 2008, may exceed the limitation, subject to payment limitation rules in effect on the date of contract approval.

3/ $200,000 limitation is the total limit under all CSP contracts entered into subsequent to the enactment of the 2014 Farm Bill during fiscal years 2014 through 2018.

4/ $450,000 limitation is the total limit under all EQIP contracts entered into subsequent to the enactment of the 2014 Farm Bill during fiscal years 2014 through 2018.

5/ $50,000 limitation is the total limit that a participant may receive under the AMA program in any fiscal year.

6/ Total payments received under LIP, LFP, and ELAP may not exceed $125,000. A separate limitation applies to TAP payments. For SURE payments for losses on or before September 30, 2011, the payment limit regulations in effect when those losses occurred apply. The SURE limit is separate from the payment limitation amount applicable to LIP, LFP, TAP, and ELAP benefits authorized under the 2014 Farm Bill.

 Following are the years that FSA will use for the calculation of the average AGI:

Crop Year

Avg. AGI to be based on the following years


2012, 2011 and 2010


2013, 2012 and 2011


2014, 2013 and 2012


2015, 2014 and 2013


2016, 2015 and 2014

Comments: The new AGI and payment limits are expected to provide more clarity in the case of AGI in that it no longer involves separate on-farm and off-farm AGI tests. As for the payment limits, the unified limit covering ARC, PLC, MLG and LDP benefits also simplifies the situation as there were individual program payment limits under the 2008 Farm Bill that are now replaced with one limit covering ARC, PLC and MLG/LDP. Also, the actively engaged requirements are likely to change as USDA has signaled they want to finalize changes in this area by the end of 2014.


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.