By Jamie Martin
The One Big Beautiful Bill (HB 1) introduces a policy change welcomed by U.S. farms. Limited liability companies (LLCs), corporations, and similar entities can now receive multiple Farm Service Agency (FSA) payments while protecting owners from personal liability.
Previously, LLCs and corporations were capped at a single annual payment limit of $125,000 for federal programs like Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC). To access more support, many operations became general partnerships, exposing members to personal financial risk.
HB 1 treats LLCs and S corporations as pass-through entities, mirroring partnership treatment. Each actively engaged owner can now qualify for an individual payment limit, inflation-adjusted to $155,000. This lets multi-member farm families enjoy both higher payment opportunities and the legal protections of an LLC.
The Farm Service Agency maintains strict oversight. Every participant claiming a separate limit must provide labor or management and contribute capital according to their share. Detailed documentation, adjusted gross income caps, and audits remain in place to deter fraud and protect taxpayer dollars.
Farmers operating as partnerships can easily convert to an LLC by filing a Certificate of Conversion with their state. The process is low cost, preserves business continuity, and provides stronger liability protection while keeping FSA eligibility intact.
By removing the final barrier to LLC formation, HB 1 helps farmers simplify their operations, reduce risk, and continue focusing on productive agriculture under clear and fair rules.
Categories: National