Conservation Programs Not Subject to AGI Testing in Certain Situations
OBBBA does not require AGI testing if your farm AGI is more than 75% of total AGI
My son and I were able to play the Plantation Course at Kapalua yesterday and of course my son made me play from the tees that were almost 7,000 yards. He ended up shooting one over par and I was about 10 over which is not too bad for an old man like me. I even had a birdie and almost birdied the 600-yard finishing hole. It did take me a while to get used to yardage going from 6,000+ elevation at my home course to sea level.
My son and I had played in the Pro-Am a couple of years ago with Ludvig Aberg and Erik Van Rooyen and it looks completely different without all of the grandstands surrounding the holes. The Plantation Course is likely my son’s favorite course to play, and it is in my top 5.
Now onto the regular blog post.
The One Big Beautiful Bill Act (OBBBA) retains the Adjusted Gross Income (AGI) testing for farm program payments under Title I (ARC and PLC). However, for payments that would be received under Title II (conservation programs) are not subject to the $900,000 AGI test if farm AGI is greater than 75% of total AGI.
The good news is that OBBBA also changed the rule to indicate that gains from selling or trading farm equipment is now automatically farming income so this will help most active farmers qualify for this exception.
Many farmers who participate in these programs and starting for any payments received after September 30, 2024, the $900,000 AGI test will not apply if their farm AGI is greater than 75% of total AGI.
A summary of the various Title II programs is as follows:
