USDA's
Discrimination Financial Assistance Program
WHAT IS USDA'S
DISCRIMINATION FINANCIAL ASSISTANCE PROGRAM?
The United States Department of Agriculture’s (USDA) Discrimination Financial Assistance Program (DFAP) is a limited-time program that Congress authorized in Section 22007 of the Inflation Reduction Act (IRA) in August 2022 for the purpose of providing financial assistance to ranchers, farmers, and forest landowners determined to have experienced discrimination in USDA lending programs prior to January 1, 2021.​
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WHAT IS IAC'S ROLE IN USDA'S
DISCRIMINATION FINANCIAL ASSISTANCE PROGRAM?
IAC is serving as a “cooperator” to ensure that the latest information about the Discrimination Financial Assistance Program reaches Tribal producers and to provide direct assistance to Tribal producers during virtual and in-person events throughout the application period. As a cooperator, IAC also makes requests for improvements to USDA guidance on the DFAP based on feedback we hear from Tribal producers.
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IAC has no role in processing the DFAP applications or making determinations on discrimination claims. While IAC advocated for certain Tribal considerations since Congress passed the Inflation Reduction Act in August 2022, IAC had no say in the final design or implementation of the DFAP.
PAYMENTS
Under Section 22007 of the IRA, the USDA provided $2 billion in financial assistance to farmers, ranchers, and forest landowners who reported discrimination in USDA farm lending before January 2021. In a press release about the DFAP payments, President Joe Biden and Agriculture Secretary Tom Vilsack expressed a commitment to justice and support for agricultural producers across the nation, acknowledging the importance of this program in promoting fairness within USDA’s operations.
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DFAP applications were accepted from July 7, 2023, to January 17, 2024, with approximately 58,000 applications received. All decisions and awards were made as of July 30, 2024. More than 43,000 individuals will receive their decisions via mail (based on the mailing address provided on their DFAP application). Individuals who applied using the online portal may also log in to check their application status. If you applied and don’t receive an award or denial by August 6, 2024 call the DFAP Hotline at 1-800-721-0970.
QUICK FACTS ABOUT DFAP AWARDS
Over 43,000 individuals receive financial assistance through the program via two categories of awards:
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Category 1: Over 23,000 individuals who have or had a farming or ranching operation are receiving between $10,000 and $500,000 of assistance, with an average of nearly $82,000
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Category 2: Over 20,000 individuals who planned to have a farming or ranching operation but reported they were unable to do so because they couldn’t get a USDA loan. These individuals are receiving between $3,500 and $6,000 of assistance, with an average of $5000
Awards are being mailed directly to applicants if applicants explicitly directed the award to law firms representing them.
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Financial assistance received through this program is part of your 2024 gross income for tax purposes, regardless of whether or when the payment is cashed or deposited.
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For some individuals, there may be a requirement to pay self-employment taxes, too. See https://www.irs.gov/newsroom/frequently-asked-questions-about-usdas-discrimination-financial-assistance-program.
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Individuals who get financial assistance will also get an IRS Form-1099 showing the money they have received.
For more information on how DFAP financial assistance may affect your tax bill, including how to report the award and whether you must pay self-employment tax, see https://extension.usu.edu/ruraltax/dfap.