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[1] See References in Text note below.
§ 1308. Payment limitations
(d)
Limitation on marketing loan gains and loan deficiency payments
(1)
Loan commodities
The total amount of the following gains and payments that a person may receive during any crop year may not exceed $75,000:
(A)
Any gain realized by a producer from repaying a marketing assistance loan for 1 or more loan commodities under subtitle B of title I of the Farm Security and Rural Investment Act of 2002 [7 U.S.C. 7931 et seq.] at a lower level than the original loan rate established for the loan commodity under that subtitle.
(2)
Other commodities
The total amount of the following gains and payments that a person may receive during any crop year may not exceed $75,000:
(A)
Any gain realized by a producer from repaying a marketing assistance loan for peanuts, wool, mohair, or honey under subtitle B or C of title I of the Farm Security and Rural Investment Act of 2002 [7 U.S.C. 7931 et seq., 7951 et seq.] at a lower level than the original loan rate established for the commodity under those subtitles.
(e)
Definition of person
(2)
(A)
For the purposes of the regulations issued under paragraph (1), subject to subparagraph (B), the term “person” means—
(i)
an individual, including any individual participating in a farming operation as a partner in a general partnership, a participant in a joint venture, a grantor of a revocable trust, or a participant in a similar entity (as determined by the Secretary);
(ii)
a corporation, joint stock company, association, limited partnership, charitable organization, or other similar entity (as determined by the Secretary), including any such entity or organization participating in the farming operation as a partner in a general partnership, a participant in a joint venture, a grantor of a revocable trust, or as a participant in a similar entity (as determined by the Secretary); and
(B)
(i)
Such regulations shall provide that the term “person” does not include any cooperative association of producers that markets commodities for producers with respect to the commodities so marketed for producers.
(ii)
In defining the term “person” as it will apply to irrevocable trusts and estates, the Secretary shall ensure that fair and equitable treatment is given to trusts and estates and the beneficiaries thereof.
(iii)
Notwithstanding any other provision of law, to be considered a separate person under this section, an irrevocable trust (other than a trust established prior to January 1, 1987) must not allow for modification or termination of the trust by the grantor, allow for the grantor to have any future, contingent, or remainder interest in the corpus of the trust, or provide for the transfer of the corpus of the trust to the remainder beneficiary in less than 20 years from the date the trust is established except in cases where the transfer is contingent on the remainder beneficiary achieving at least the age of majority or is contingent on the death of the grantor or income beneficiary.
(C)
The regulations shall provide that, with respect to any married couple, the husband and wife shall be considered to be one person, except that, for the purpose of the application of the limitations established under this section—
(i)
in the case of any married couple consisting of spouses who, prior to their marriage, were separately engaged in unrelated farming operations, each spouse shall be treated as a separate person with respect to the farming operation brought into the marriage by the spouse so long as the operation remains as a separate farming operation; and
(ii)
at the option of the Secretary, in the case of any married couple consisting of spouses who do not hold, directly or indirectly, a substantial beneficial interest in more than one entity (including the spouses themselves) engaged in farm operations that also receives farm program payments (as described in subsections (b), (c), and (d) of this section) as separate persons, the spouses may be considered as separate persons if each spouse meets the other requirements established under this section and section
1308–1 of this title to be considered to be a separate person.
(3)
The regulations issued by the Secretary on December 18, 1970, under section
1307 of this title shall be used to establish the percentage ownership of a corporation by the stockholders of such corporation for the purpose of determining whether such corporation and stockholders are separate persons under this section.
(4)
Any person that conducts a farming operation to produce a crop subject to limitations under this section as a tenant that rents the land for cash (or a crop share guaranteed as to the amount of the commodity to be paid in rent) and that makes a significant contribution of active personal management but not of personal labor shall be ineligible to receive any payment specified in paragraph (1) or (2) or subtitle D of title XII [16 U.S.C. 3830 et seq.] with respect to such land unless the tenant makes a significant contribution of equipment used in the farming operation.
(5)
The Secretary may not approve (for purposes of the application of the limitations under this section) any change in a farming operation that otherwise will increase the number of persons to which the limitations under this section are applied unless the Secretary determines that the change is bona fide and substantive. In the implementation of the preceding sentence, the addition of a family member to a farming operation under the criteria set out in section
1308–1
(b)(1)(B) [1] of this title shall be considered a bona fide and substantive change in the farming operation.
(f)
Public schools
The provisions of this section that limit payments to any person shall not be applicable to land owned by a public school district or land owned by a State that is used to maintain a public school.
(g)
Time limits; reliance
Regulations of the Secretary shall establish time limits for the various steps involved with notice, hearing, decision, and the appeals procedure in order to ensure expeditious handling and settlement of payment limitation disputes. Notwithstanding any other provision of law, actions taken by an individual or other entity in good faith on action or advice of an authorized representative of the Secretary may be accepted as meeting the requirement under this section or section
1308–1 of this title, to the extent the Secretary deems it desirable in order to provide fair and equitable treatment.
[1] See References in Text note below.
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