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Direct Attribution

Payments will be limited by direct attribution to individuals or entities. A legal entity is defined as an entity created under federal or state law that owns land or an agricultural commodity, product or livestock. Through direct attribution, payment limitation is based on the total payments received by the individual, both directly and indirectly. Under direct attribution, payments made to individuals remain unchanged. However, payments to legal entities, such as corporations, limited partnerships, limited liability companies and other similar entities, are limited by attributing the payment to an individual based on their direct and indirect interest in the entity.

For example, Producer A receives a DCP direct payment of $32,000 as an individual. In addition, Producer A has a 33.33% interest in Corporation ABC, which earns $30,000 in DCP direct payments. The application of direct attribution would result in $10,000 being attributed to Producer A, resulting in total earnings of $42,000. Since the limitation for DCP direct payments is $40,000, Producer A’s payments will be reduced by $2,000. The following are program limitations for the 2012 program year:

1/ Under ACRE, this amount will be a combined limitation for counter-cyclical and ACRE payments.  If a person or legal entity has a direct or indirect interest in payments earned on a farm participating in ACRE, this limitation will reflect an increase for the amount that the direct payments were reduced.

2/ If the person or legal entity has a direct or indirect interest in payments earned on a farm that is in ACRE, this limitation will reflect a 20% reduction in direct payments on each farm that is participating in ACRE.