7 CFR § 1400.503 - Commensurate reduction.

---
identifier: "/us/cfr/t7/s1400.503"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "7 CFR § 1400.503 - Commensurate reduction."
title_number: 7
title_name: "Agriculture"
section_number: "1400.503"
section_name: "Commensurate reduction."
chapter_name: "COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE"
subchapter_number: "A"
subchapter_name: "GENERAL REGULATIONS AND POLICIES"
part_number: "1400"
part_name: "PAYMENT LIMITATION AND PAYMENT ELIGIBILITY"
positive_law: false
currency: "2026-03-24"
last_updated: "2026-03-24"
format_version: "1.1.0"
generator: "[email protected]"
authority: "7 U.S.C. 1308, 1308-1, 1308-2, 1308-3, 1308-3a, 1308-4, and 1308-5; and Title I, Pub. L. 115-123."
regulatory_source: "73 FR 79273, Dec. 29, 2008, unless otherwise noted."
cfr_part: "1400"
---


# 1400.503 Commensurate reduction.

(a) Any program payment or benefit subject to this subpart provided to a legal entity, general partnership, or joint venture will be reduced by an amount commensurate with the direct and indirect ownership interest in the legal entity, general partnership, or joint venture of each person or legal entity determined to have an average adjusted gross income in excess of the applicable limitation under the standards provided elsewhere in this subpart for the direct recipient of the payments.

(b) Ownership interest in a legal entity will be reviewed to the fourth level of ownership, as specified in § 1400.105, to determine whether a commensurate reduction is applicable and the extent of the reduction. If an ownership interest is not held by a person in the fourth level of ownership in a legal entity, no payment or benefit will be made with respect to the interest.

[73 FR 79273, Dec. 29, 2008, as amended at 85 FR 52040, Aug. 24, 2020]