Nate Bruce, Farm Business Management Specialist, nsbruce@udel.edu
Funding for farm support programs will rise by $66 billion following the signing of new legislation on July 4th. The bill passed the House by a narrow margin of 218–214 after a contentious debate. In addition to expanding funding for farm-related programs, the legislation extends provisions from the 2017 Tax Cuts and Jobs Act and the 45Z Clean Fuels Production Credit.
Beginning in 2026, the estate-tax exemption will increase to $15 million for individuals and $30 million for married couples and will be made permanent. The bill also includes several tax changes intended to benefit farmers, including provisions related to investment in equipment, property transfers, and farmland transactions. The extension of the 45Z Clean Fuels Production Credit, a federal tax incentive aimed at promoting domestic clean fuel production, is expected to reduce imports of certain inputs such as used cooking oil.
Substantial increases are included for the Price Loss Coverage (PLC) and Agriculture Risk Coverage (ARC) programs. Farmers may enroll up to 30 million additional base acres based on planting history from 2019–2023. Payment limits under these programs will increase from $125,000 to $155,000 for individuals and from $250,000 to $310,000 for married couples and will be adjusted for inflation. Commodities with the largest number of planted acres may see lower per-acre payments. Crop insurance programs will receive an additional $6.3 billion in funding over the next 10 years, including higher premium subsidy levels. The bill also introduces new support for beginning farmers and a pilot insurance program for poultry producers.