USDA Makes Announcements on SURE, Actively Engaged Rules

January 8, 2010 Bookmark and Share

USDA released three key pieces of information relating to implementation of the 2008 Farm Bill during the holiday break.

The Department announced Christmas Eve that the new Supplemental Revenue Assistance program (SURE) is now in place, and eligible producers could sign up beginning Jan. 4.

SURE was established in the 2008 Farm Bill as a new program to supplement crop insurance coverage for producers with whole farm revenue losses. SURE eligibility requires a combination of individual farm loss and state-level loss. Producers must also either have crop insurance or NAP coverage or have obtained a waiver for 2008 crops.

The announcement had been long awaited; NAWG Secretary-Treasurer Erik Younggren testified to Members of the House Agriculture Committee in June that the program should be implemented as soon as possible.

A week after the SURE announcement, on New Year’s Eve, USDA said it has reached an agreement with the Internal Revenue Service to establish an electronic information exchange process for verifying compliance with new adjusted gross income (AGI) requirements.

The 2008 Farm Bill set a $500,000 nonfarm average AGI limit for those receiving commodity and disaster program payments; $750,000 farm average AGI limit for those receiving direct payments; and $1 million nonfarm average AGI limit for those receiving conservation programs.

USDA described the electronic process as reviewing data from tax returns, performing a series of calculations and comparing the values it derives with AGI limits in the 2008 Farm Bill. Implementing subagencies will then will receive a record that indicates whether or not the program participant appears to meet the income limits.

USDA said written consent will be required from each producer or payment recipient for this process, and no actual tax data will be included in the report that IRS sends to USDA.

The IRS announcement also included new information about USDA’s rules relating to the definition of “actively engaged” for the purposes of receiving farm program payments.

The actively engaged requirements affect eligibility for direct payments, counter-cyclical payments and ACRE payments.

USDA said that under its amended rules, every stockholder or member of a legal entity like a corporation does not have to contribute labor or management if:

  • at least half of the interest in the legal entity is held by stockholders or members who are providing active personal labor or active personal management that altogether qualifies as a significant contribution to the farming operation; AND
  • the total direct payments received, both directly and indirectly, by the legal entity and each of the members does not exceed $40,000.

USDA described this change as intended to allow family farming operations, many of which include family members who live off-farm, to meet the requirement.

Producers can find more information about these and other 2008 Farm Bill implementation issues at or at their local Farm Service Agency offices.