Micro-Grants for Food Security Tax Treatment

Current understanding

The USDA Micro-Grants for Food Security Program (established in the 2018 Farm Bill) provides small grants in food-insecure states and territories (e.g., Alaska, Hawaii, U.S. territories, and tribal areas) to increase local production of food. Under current tax law, recipients may owe federal income tax on these grants, reducing their net value; S4780 proposes to amend the Internal Revenue Code to exclude such micro-grants from gross income. Status: introduced in the Senate; effect on recipients would be a modest increase in effective grant value, with negligible expected impact on consumer food prices.

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