Changes in Payment Limits for Farm Business Entities

By Susanne Hinrichs

During the summer of 2025, Congress passed a bill titled “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14,” commonly referred to as the One Big Beautiful Bill (OBBBA). OBBBA has drawn both praise and criticism from various reviewers. One notable change will positively impact farms operating as business entities and the payment limits set by the Farm Service Agency (FSA).

Previously, if your farm operated as a business entity—such as an LLC or an S Corporation—the FSA treated the entity as a single “person,” capping payments like Agricultural Risk Coverage (ARC) or Price Loss Coverage (PLC) at $125,000, regardless of the number of owners or shareholders.

Under the new rules, which generally apply to the 2025 crop year (payments issued after October 1, 2026), members of qualified pass-through entities (LLCs, corporations, and partnerships) are eligible for separate payment limits, provided each individual meets the “actively engaged in farming” requirement.

Example:

The Johnson family has four members actively involved in their farming operation. They previously farmed as a general partnership—sharing equipment, labor, and profits, but without liability protection for personal assets. Under the old rules, this allowed them to receive multiple FSA payments.