USDA DFAP Awards and Supplemental Nutrition Assistance Program (SNAP)
USDA DFAP Awards and Supplemental Nutrition Assistance Program (SNAP)
The information below is for the farmers and ranchers who applied for and received one-time, lump-sum awards from the United States Department of Agriculture (USDA) under the USDA Discrimination Financial Assistance Program (DFAP). DFAP was created to address the consequences of prior discrimination by USDA in USDA farm lending. This general information will help people who receive these USDA DFAP awards understand the potential impact of the money on SNAP benefits.
THE USDA DFAP Award MAY AFFECT YOUR SNAP ELIGIBILITY.
EVERYONE’S SITUATION IS DIFFERENT. BE SURE TO CONSULT AN ATTORNEY OR ADVOCATE KNOWLEDGEABLE ABOUT SNAP IN YOUR STATE FOR SPECIFIC ADVICE. See below for a list of resources.
What are SNAP benefits?
SNAP is a federal program that provides benefits to low-income households to help pay for food at local grocery stores. SNAP benefits are administered by state human service agencies. SNAP eligibility and program rules differ in each state.
How could my USDA DFAP award affect my SNAP benefits?
Your eligibility for SNAP depends on your household’s income and assets/resources. The lump-sum award you receive from the USDA DFAP is not income, but a resource. If your total resources increase above the maximum allowed by SNAP, you will no longer be eligible for SNAP. But if you remain eligible, your DFAP award will not affect the amount of SNAP you receive.
When is my USDA DFAP award considered “income” for SNAP?
A one-time, lump-sum payment by the government, like the USDA DFAP award, is never considered income for SNAP purposes.
When is my USDA DFAP award considered a “resource?”
Any of the USDA DFAP award left over after the month you receive it is a resource. For example: if you receive an award of $5,000 in June, and you spend $1,000 in June, the remaining $4,000 is a resource beginning in July and continuing each following month you have the money.
What are the SNAP resource limits in my state?
If you still have enough of the USDA DFAP award the month after you receive it to increase your total resources above the maximum allowed in your state, you will not be eligible for SNAP.
In Mississippi , SNAP resource limits are:
$4250.00 for households that:
- Contain at least one member who is age 60 or older, or disabled; OR
- Receive Supplemental Security Income (SSI); OR
- Receive Temporary Assistance for Needy Families (TANF, or welfare)
$2750.00 for all other households.
What can I do to avoid or minimize the impact of the USDA DFAP award on my SNAP benefits?
If your USDA DFAP award will increase your resources above the limit, you can avoid its impact on your SNAP benefits by spending it in the month you receive it. It is a good idea to save receipts or other documentation of how you spent it, just in case your state agency has questions.
Some permissible ways to spend the DFAP award include: paying off bills (e.g. past due rent, utilities, credit cards); buying new furniture or household goods; buying new farm equipment; buying an irrevocable prepaid burial policy; buying gift cards for stores you often shop at (Wal-Mart, grocery store). Generally, it is not a good idea to pre-pay rent. If you have a large amount of money, consider funding a 529 account (for children’s educational expenses) or an ABLE account (savings for people who were disabled before age 26). Neither of these accounts are considered resources for SNAP.
DO NOT GIVE THE MONEY AWAY. Giving away the money could make you ineligible for the SNAP program for up to one year.
Do I need to report the USDA DFAP award to the human services agency in my state?
Best practice is to report all significant income and resource changes within 10 days of the change. Keep all receipts and other documentation of how the funds were spent in case your state agency asks you to prove you no longer have the funds available to you.
In the State of Mississippi, you must report within ten (10) of the date the household becomes aware of the change of more than $125.00 in the amount of gross earned income (such as wages, tips, bonuses, self-employment, etc.).
If you spend the whole award in the month you receive it, you do not need to report it. If you have any money left over in the month afterward, and it pushes your resources above the limit, you should report it.
How do I get information about my SNAP benefits?
Contact the Mississippi Department of Human Service Division of Economic Assistance P. 0. Box 352, Jackson, MS 39205. The telephone number t is 1-800-948-3050.
Where can I find more information about the impact of the USDA DFAP award on my SNAP benefits?
You can call 1 800 498 1804 to be connected with the Legal Aid office that serves your community. Not all Legal Aid programs can assist with these kinds of questions, and they only serve people who meet financial and other eligibility requirements.
Not all Legal Aid programs can assist with these kinds of questions, and they only serve people who meet financial and other eligibility requirements. You can look up your local Legal Aid at https://www.lsc.gov/about-lsc/what-legal-aid/i-need-legal-help
Many USDA DFAP award recipients can request brief legal advice through the ABA Free Legal Answers platform at https://abafreelegalanswers.org/. You will need to select the state where you live and provide income and asset information to determine eligibility for free legal advice, which is generally available to people with household income below 250% of the federal poverty guidelines. When answering questions about your assets, do not include your DFAP award. Once you are approved, you can create an account to ask a question and get advice from a volunteer attorney.
Additional resources and information will be available soon at https://www.nlada.org/USDA-DFAP/award-recipients.
For general questions about your USDA DFAP award, contact the DFAP Call Center at 1-800-721-0970.