Section 22006 of the Inflation Reduction Act provides $3.1 billion for USDA to provide relief for distressed borrowers with certain Farm Service Agency (FSA) direct and guaranteed loans and to expedite assistance for those whose agricultural operations are at financial risk.
This program complements other assistance made possible through the IRA, including producers who experienced discrimination in USDA farm loan programs.
Current Assistance
In October 2024, USDA provided an additional $250 million in assistance to help about 4,650 distressed direct and guaranteed farm loan borrowers. This assistance is meant to help farmers stay on their land by addressing delinquencies and providing relief to those facing financial hardship.
The funding includes $235 million for roughly 4,485 borrowers who are behind on their loans but haven’t received prior help under this program. Another $15 million is set aside for around 165 borrowers with Shared Appreciation Agreements.
Payments will be automatically applied to eligible borrowers in three categories: direct borrowers with overdue payments, guaranteed borrowers who are 30 or more days behind, and those with Shared Appreciation Agreements.
USDA will continue to assess borrower needs and offer more assistance while funds are available.
Cash Flow-Based Assistance
Status of Requests for Cash Flow-Based Assistance
The Cash Flow-Based Assistance submission period ended December 31, 2023.
All requests were initially handled by the local FSA Office. All requests submitted prior to the deadline were followed up with an FSA letter regarding the status of the request.
If you have any questions regarding your request, please contact your FSA County Office Loan Official.
About Cash Flow-Based Assistance
USDA implemented a process to identify whether an operation has sufficient cash flow to make their next scheduled loan payment. Through this procedure, qualifying borrowers had the opportunity to request FSA cover their next installment due or a recently missed installment.
All FSA direct loan borrowers should have received a letter in February 2023 detailing the process for seeking this type of assistance even before they become delinquent. A reminder letter was mailed to all direct loan borrowers in September 2023 to clarify the assistance criteria.
For more information, see the steps in the cash flow-based assistance review process.
Extraordinary Measures Assistance
Status of Requests for Extraordinary Measures Assistance
The Extraordinary Measures Assistance submission period ended December 31, 2023.
All requests submitted prior to the December 31, 2023 deadline were followed up with a telephone call from member of the IRA Response Team and a FSA letter regarding the status of requests.
If you received a Notice of Request for Additional Information letter in response to your request for extraordinary measures assistance and you still need to upload additional documentation, a member of the IRA Response Team will be in touch with you regarding secure submission of additional documentation. Please do not submit this documentation via email.
About Extraordinary Measures Assistance
In May 2023, USDA sent a letter to all FSA direct loan borrowers detailing the opportunity to receive assistance if they took extraordinary measures to avoid delinquency between February 28, 2020 and October 18, 2022, such as taking on more debt, selling property, or cashing out retirement accounts. The letter provided specific types of actions that may qualify for assistance and the documentation needed to receive assistance.
For more information, see the steps in the extraordinary measures assistance review process.
Initial Automatic Assistance for Direct and Guaranteed Loan Borrowers
In October 2022, USDA provided approximately $800 million in initial IRA assistance to more than 11,000 delinquent direct and guaranteed borrowers and approximately 2,100 borrowers who had their farms liquidated and still had remaining debt. Case-by-case reviews of about 1,600 complex cases for potential initial relief payments, including cases of borrowers in foreclosure or bankruptcy, are underway.
Additional Financial Assistance for Direct Loan Borrowers
In May 2023, USDA offered an additional approximately $130 million in automatic financial assistance for qualifying direct loan borrowers based on the specific circumstances of their direct loans.
Additional Financial Assistance for Qualifying Guaranteed Farm Loan Borrowers
In August 2023, USDA announced additional, automatic financial assistance for qualifying guaranteed Farm Loan Programs (FLP) borrowers facing financial risk. This assistance was only available for FLP guaranteed loan borrowers who did not or would not receive an initial payment on the same FLP guaranteed loan under Inflation Reduction Act assistance announced in October 2022.
FSA also provided relief to qualifying FLP guaranteed loan borrowers determined to be distressed borrowers based on liability for remaining federal debt subject to debt collection and garnishment after the liquidation of their guaranteed loan account as of July 31, 2023.
Guaranteed borrowers who qualified for this assistance had their federal debt paid automatically by FSA and received a letter informing them of the payment made on their federal debt.
Assistance for Guaranteed Borrowers Facing Foreclosure and Direct Borrowers with Emergency Loans
In November 2023, USDA announced that to help prevent foreclosures, it would cover approximately $80 million in delinquencies for an estimated 210 borrowers whose qualifying guaranteed loans were flagged for liquidation as of November 30, 2023.
USDA also announced it would provide approximately $128 million for an estimated 1,120 borrowers with currently outstanding direct Emergency Loans as of Nov. 30, 2023.
For any qualifying guaranteed borrowers that also qualified for previous Inflation Reduction Act assistance announced in October 2022 or August 2023, payments may be adjusted to account for that assistance.
Tax Implications
Payments provided directly to borrowers and payments to be applied to FSA farm loan accounts will be reported to the Internal Revenue Service (IRS). Borrowers receiving IRA 22006 assistance will receive a 1099 form from FSA. Please note that payments over $600 are subject to Federal and State Income Taxes and will be reflected on your annual 1099 form.
Borrowers are encouraged to consult a tax professional with all tax-related questions regarding any IRA assistance received.
See Additional Tax Resources for Farmers and Ranchers
Revised 1099 Forms for Borrowers who Received IRA 22006 in 2022
Direct loan borrowers who received Section 22006 assistance in 2022 received a set of revised tax documents in early 2023 along with a letter explaining the revised forms and notifying the borrower of options that may be available to avoid or alleviate any tax burden incurred as a result of receiving that financial assistance.
USDA cannot provide tax advice and encourages borrowers to consult their own tax professional, but FSA is providing educational materials for borrowers to be aware of the options.
Read frequently asked questions for direct loan borrowers who received Section 22006 assistance in 2022:
- English: Frequently asked questions
- Spanish: Preguntas frecuentes generales
Additional Resources
For more information, contact FSA at your local USDA Service Center or through the FSA call center at 877-508-8364 between 8 a.m. and 7 p.m. Eastern. Additional information can be found below.
FAQs and Fact Sheets
- Frequently Asked Questions About Inflation Reduction Act Assistance for Distressed Borrowers
- At a Glance: Inflation Reduction Act Assistance for Distressed Borrowers
- Inflation Reduction Act Section 22006 Cash Flow Based Assistance
- Inflation Reduction Act 22006 Extraordinary Measures Assistance
- Inflation Reduction Act 22006 Additional Automatic Payments for Distressed Borrowers
- Inflation Reduction Act Assistance for Distressed Borrowers
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- Inflation Reduction Act Investments in FPAC Loan and Conservation Programs
Letters to Borrowers
- September 12, 2023: Revised Letter to FSA distressed borrowers about Cash Flow-Based Assistance (en español)
- May 19, 2023: Letter to FSA direct loan borrowers about Extraordinary Measures Assistance (en español)
- February 16, 2023: Letter to FSA distressed borrowers about Cash Flow-Based Assistance
News Releases
- October 7, 2024: USDA Announces Additional $250 Million in Financial Assistance for Distressed Farm Loan Borrowers
- November 30, 2023: USDA Provides $208 Million to Help Prevent Guaranteed Borrower Foreclosures and to Assist Emergency Loan Borrowers
- Aug. 11, 2023: USDA To Provide Additional Financial Assistance to Qualifying Guaranteed Farm Loan Borrowers Facing Financial Risk
- May 1, 2023: USDA is Providing $130 Million in Assistance to Help Farmers Facing Financial Risk
- March 27, 2023: USDA Announces Additional Assistance for Distressed Farmers Facing Financial Risk
Find Your Local Service Center
USDA Service Centers are locations where you can connect with Farm Service Agency, Natural Resources Conservation Service, or Rural Development employees for your business needs. Enter your state and county below to find your local service center and agency offices. If this locator does not work in your browser, please visit offices.usda.gov.
Learn more about our Urban Service Centers.
Visit the Risk Management Agency website to find a regional or compliance office or to find an insurance agent near you.