A Final $306 Million ERP Payment Will be Paid for 2020 and 2021 Disasters
USDA announced more money to be paid to farmers who had qualifying disasters in 2020 and 2021. These payments will only be paid to farmers who collected payments under Phase 1 not Phase 2.
Growers were originally paid 75% of the estimated damage amount for 2020 and 2021. This final payment represents an additional 3.5% for a final top-off of 78.5%.
However, many farmers will not receive additional payments if they have already hit the payment limit of $125,000 which is a combination of Phase 1 and Phase 2 for each of those years. Let’s look at an example:
Betty received a 2020 ERP Phase 1 payment of $100,000. She also received a Phase 2 payment of $21,375. The $100,000 payment equates to a total calculation of $133,333. 3.5% of this number is $4,667, however, she is limited to a final payment of $3,625.
This payment is for damage in 2020 and 2021, therefore, it cannot be deferred to 2025 and will need to be reported as income when received in 2024.
Thank you Paul for the update & an example. Thanks USDA for bumping up the payment.
It would be really nice if USDA would now pay the full 80% on the PARP program.