Federal Poverty Level Guidelines and Chart
Are You Eligible for Federal Benefits in 2018?
The federal poverty level is the indicator the U.S. government uses to determine who is eligible for federal subsidies and aid.
The Department of Health and Human Services issues new poverty guidelines each January. It must update the poverty levels to account for inflation.
2018 Federal Poverty Guidelines Chart
HHS issues guidelines for each household size. For example, the poverty level for a household of four is an annual income of $24,600.
To get the poverty level for larger families, add $4,320 for each additional person in the household. For smaller families, subtract $4,320 per person. Guidelines for Alaska and Hawaii are higher since it's more expensive to live there. The chart below calculates it for you.
|Number of People in Household||48 States & DC||Alaska||Hawaii|
|For more than eight, add this amount for each additional person|
Agencies help families who earn more than the federal poverty level. For example, some programs offer subsidies to families that are 150 percent of the federal poverty level.
For a household of four that would be 1.5 x $25,100 = $37,650. The HHS 2018 Federal Poverty Guidelines offers more specific information.
Programs That Use the Poverty Guidelines
The Supplemental Nutrition Assistance Program is available to those who earn 130 percent of the federal poverty level. Households must also have less than $3,500 in assets with an elderly or disabled person, or $2,250 or less in households without an elderly or disabled member.
Medicaid is available to families whose income is 138 percent of the poverty level. The Affordable Care Act provides insurance subsidies for households between 138 percent and 400 percent of the poverty level.
Other programs include Head Start, the National School Lunch Program, the Low-Income Home Energy Assistance Program, and the Children’s Health Insurance Program.
Federal programs that hand out cash don't use the poverty guidelines. These programs include Temporary Assistance for Needy Families, the Earned Income Tax Credit, and the Supplemental Security Income.
The Poverty Level and Obamacare
In October 2013, the poverty level became relevant to millions more Americans. That's when the health insurance exchanges for Obamacare opened for enrollment. Those making 400 percent or less of the poverty level became eligible for tax credits to help pay insurance costs. As there are varying levels for different household sizes, see whether you qualify to save on monthly premiums.
Those making 138 percent or less of the poverty level became eligible for Medicaid. Specific eligibility depends on each particular state. Applicants find out if they are eligible when they apply on the exchanges.
How the Poverty Guidelines Measure Eligibility
The poverty level measures a family's annual cash income. Each agency administering an assistance program determines whether to use the family's before-tax or after-tax income in computing eligibility.
Other poverty indicators measure total wealth, annual consumption, or a subjective assessment of well-being. These indicators point to one’s standard of living, which takes into account only the amount of material goods and services available to the individual or family.
HHS prefers the term "poverty guidelines" instead of "poverty level" because it is more precise. People use the term poverty level to describe the poverty guidelines and the federal poverty threshold.
The second term is a U.S. Census Bureau statistic. It tells you how many Americans live in poverty. The poverty guidelines are based on the threshold, but HHS uses it to administer poverty programs. The ASPE further describes the differences between the poverty threshold and the poverty guidelines.
The federal poverty level originated during President Lyndon Johnson's War on Poverty. It was one of the tools developed to measure and eradicate poverty.
In his Inaugural address, Johnson called for "the richest nation on earth" to win the war. He wanted to assist "...American families with incomes too small to even meet their basic needs." This War on Poverty created many of today's welfare programs.