Overview:
OBBB - The One, Big, Beautiful Bill Act
Passed & signed into law on July 4th, 2025 (H.R.1 of the 119th Congress)
includes a number of positive changes / provisions for agriculture that either go into effect this year or next - MORE info below
SDRP - Supplemental Disaster Relief Program
Passed & signed into law as part of the American Relief Act (ARA) on Dec. 21st, 2024
SDRP is a $16B disaster aid package for weather related losses in 2023 & 2024
The sign up period begins TOMORROW, July 10th at FSA - MORE info below
ECAP - Emergency Commodity Assistance Program
The ARA also created the $10B ECAP for economic losses in 2024… you should have already signed up for and received the first 85% of this earlier this year (most did in April). If you haven’t done so already, please contact FSA before the August 15th deadline. To date, more than $7.8B in ECAP payments have been issued. We expect the remaining 15% to be paid out soon after the application deadline of August 15th.
SDRP - key info:
The sign up period begins tomorrow, July 10th. Sign up is done through your local FSA office.
There are 2 stages to this program.
Stage 1:
This should be a streamlined, pre-filled application process through FSA.
If you had a federal MPCI loss in 2023 or 2024 due to a weather related cause (drought, flooding, etc), you should automatically qualify for a SDRP payment. Using info from your federal MPCI, FSA will automatically calculate your SDRP loss and prefill the app for you, so your effort in applying should be minimal.
Starting tomorrow July 10th, we think you will be able to contact your local FSA office and ask if they can generate & print your prefilled app for you (Form FSA-526).
With that said, most FSA offices are extremely busy right now with acreage certification with the July 15th deadline rapidly approaching… so I am guessing they would prefer people to wait a week or so to let them finish up with certifying acres and for them to get their bearings on this new SDRP program.
Similarly, today FSA is also mailing out the prefilled apps to all who qualify for Stage 1.. so if you want to / can be patient and wait for it to arrive in the mail, I am sure your local FSA office may appreciate this as well.
Stage 1 payment = SDRP loss x 90% x 35% payment factor
Later on, if additional funds remain, FSA may issue a 2nd payment
SDRP loss calculation: at this time, we are not exactly sure how the SDRP losses will be calculated, but we think the SDRP loss will be something like this:
SDRP loss $/ac >= (10% of your MPCI APH) x (higher of spring or harvest price) x (your share)... for each farm / year where you had a qualify MPCI loss... it will be like bumping your MPCI coverage level up 10%+ for those previously paid losses.
Stage 2:
If you did not have a MPCI loss, but had eligible shallow or uncovered losses, there will be a Stage 2 application where you might be eligible for a payment. Sign up for Stage 2 will being in early fall (est. Sep. 15th) and more info will be announced in the future / as we get closer to that time period.
To qualify for Stage 2, we think your yield (on a farm by farm basis?) will have to have been below 90% (or 95%?) of your APH in either 2023 or 2024.
Links to key website, more info, insight, etc.
USDA 2023/2024 Supplemental Disaster Assistance page: LINK
Qualifying losses:
Yield losses must be the result of natural disasters occurring in calendar years 2023 or 2024. These disasters include wildfires, hurricanes, floods, derechos, excessive heat, tornadoes, winter storms, freeze (including a polar vortex), smoke exposure, excessive moisture, qualifying drought, and related conditions.
To qualify for drought related losses, the loss must have occurred in a county rated by the U.S. Drought Monitor as having a D2 for 8 consecutive weeks OR D3 or greater at anytime during the applicable calendar year.
If you want to receive an SDRP payment, you are required to purchase federal crop insurance (MPCI) or NAP coverage for the next 2 available crop years.
OBBB - key info / highlights related to agriculture:
The below summary is not meant to be complete or exhaustive as the OBBB contains a lot of changes and new information that will take time to digest.
Farm Safety Net changes that go into effect THIS year - 2025 crop year
ARC / PLC
Increased reference prices
For 2025, PLC prices raised to $4.42 corn (was $4.26) and $10.71 soybeans (was $9.66) - see attached PDF for price table / more info
In 2025, if there is a loss under ARC-CO and/or PLC, you will automatically receive the higher of the two programs since the prices were changed mid year
In 2026 & after, we will be back to deciding between ARC & PLC
Built-in future reference price increases based on an inflation adjuster
Increased payment limits from $125,000 to $155,000 per person
$155k pmt limit will be increased annually based on inflation (CPI)
If married, can qualify for double ($310k)?
Good news for LLCs and S corps, they are now treated like partnerships in that each member counts toward a higher limit - ex. If 3 members in LLC, the payment limit would be increased to $465k (155 x 3).
To qualify for any and all of these higher payment limits, must earn 75% or more of your income from farming?
Eliminates the $900k AGI ‘high income’ eligibility cap on Title 1 & 2 programs
Farm Safety Net changes that go into effect starting NEXT year - 2026 crop year
increased MPCI subsidies of 3-5 percentage points (eff. a 22% discount for 75% EU)
increased SCO coverage level from 86% to 90%
increased SCO subsidy from 65% to 80% (effectively a 43% discount)
SCO is now allowed with ARC-CO (NO more possible conflict & you could have both!)
BFR (Beginning Farmer & Rancher) & VFR (Veteran Farmer & Rancher)
Now someone who has been farming for less than 10 years (instead of just 5 yrs) can receive the additional BFR or VFR subsidy of 10%+ additional subsidy
ARC-CO
Increased ARC coverage level from 86% to 90%
Increased ARC coverage band from 10% to 12%
As a result, ARC will effectively provide a band of cov. from 90% down to 78%
SCO will provide a band of cov. from 90% down to your MPCI cov. Level
Tax law changes related to agriculture:
Caveat: I am not a tax professional…please consult your tax advisor / CPA
100% bonus depreciation: permanently restores this tax deduction starting in 2025 for certain property types if placed in service on or after Jan. 19th, 2025
Pass-Through Business Income (199A): permanently extend this tax deduction starting in 2026 (can deduct up to 20% of qualified pass-through business income).
Estate & Gift Tax exemption: permanently increased from $10M to $15M (per spouse) starting in 2026 and will be increased annually with inflation
