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Living on a low income can make it harder to cover everyday expenses, build savings, and handle unexpected costs. So, what is considered low income in the U.S.? There isn’t one income level that applies to everyone.
Federal programs often use the Department of Health and Human Services (HHS) federal poverty level guidelines to determine eligibility for low-income assistance. In 2026, the guideline is $15,960 a year for a household of one and $33,000 for a household of four in the 48 contiguous states and the District of Columbia. Alaska and Hawaii have higher guidelines.
However, income limits can be much higher for certain programs, particularly housing assistance. Where you live, the size of your household, and the specific program you’re applying for can all affect whether your income is considered low.
Key Points
• There is no single, universal dollar amount that defines low income in the U.S. because definitions vary by program and location.
• The Department of Health and Human Services (HHS) issues annual federal poverty level guidelines that many government assistance programs use to determine eligibility.
• Some federal programs, particularly housing assistance, use the area median income (AMI) to set eligibility limits that account for local cost-of-living differences.
• Eligibility for low-income assistance programs often depends on a combination of household size, geographic location, and specific program criteria.
• Strategies for managing money on a low income include tracking cash flow, utilizing budget rules like the 50/30/20 method, and exploring community or government resources.
What Is Low Income?
“Low-income” does not have one universal dollar definition in the U.S. However, two measures that are commonly used when discussing low income are the HHS poverty guidelines and the area median income (AMI).
The Federal Poverty Level (FPL)
The federal poverty level (FPL) refers to the annual poverty guidelines issued by HHS. Based on statistical thresholds calculated by the U.S. Census Bureau, the FPL measures the minimum amount of gross income a household needs to cover basic living expenses like food and housing.
The FPL is primarily used by federal, state, and local agencies to determine financial eligibility for certain government programs and benefits, including programs like Medicaid and the Children’s Health Insurance Program (CHIP).
HUD Guidelines and Area Median Income
The U.S. Department of Housing and Urban Development (HUD) uses area median income (AMI) when determining eligibility for housing assistance programs. HUD develops these guidelines using Census data on median family incomes and estimates of fair market rents for individual geographic areas.
For many HUD programs, households at or below 80% of the AMI are classified as low income, while lower income limits may apply to other categories and programs. Because AMI varies by geographic area, the income limit for a household can be substantially different from one location to another.
For instance, a family of four in California might be classified as low income with an annual income of $96,150, whereas in Mississippi, that same status would apply to a household earning $64,900.
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What Income Is Considered Low Income?
If you’re using HSS poverty guidelines as a reference, the amount considered to be at or below the poverty guideline depends primarily on household size. The figures do not vary by region, except in the case of Alaska and Hawaii, which have separate, higher guidelines due to differences in cost of living.
It’s important to remember that being above the poverty guideline doesn’t necessarily mean you won’t qualify for assistance. Some programs use a percentage or multiple of the guidelines, such as 125%, 150% or 185%, while other programs use different income calculations or eligibility criteria altogether.
Household Size and Income Limits
Below are the HSS poverty guidelines for 2026.
| Household Size | 2026 Poverty Guideline (48 Contiguous States and District of Columbia) |
|---|---|
| 1 | $15,960 |
| 2 | $21,640 |
| 3 | $27,320 |
| 4 | $33,000 |
| 5 | $38,680 |
| 6 | $44,360 |
| 7 | $50,040 |
| 8 | $55,720 |
| 9+ | Add $5,680 for each extra person |
HSS poverty guidelines for Alaska:
| Household Size | 2026 Poverty Guideline (Alaska) |
|---|---|
| 1 | $19,950 |
| 2 | $27,050 |
| 3 | $34,150 |
| 4 | $41,250 |
| 5 | $48,350 |
| 6 | $55,450 |
| 7 | $62,550 |
| 8 | $69,650 |
| 9+ | Add $7,100 for each extra person |
HSS poverty guidelines for Hawaii:
| Household Size | 2026 Poverty Guideline (Hawaii) |
|---|---|
| 1 | $18,360 |
| 2 | $24,890 |
| 3 | $31,420 |
| 4 | $37,950 |
| 5 | $44,480 |
| 6 | $55,010 |
| 7 | $57,540 |
| 8 | $64,070 |
| 9+ | Add $6,350 for each extra person |
State and Local Cost of Living Adjustments
HHS poverty guidelines generally do not adjust for differences in the cost of living from one city or state to another. The same federal poverty guideline can therefore apply in a relatively low-cost area and a much more expensive one.
However, some programs use different income limits based on location. Housing programs are a good example because HUD uses geographic income limits that reflect differences in local median incomes.
Health coverage is another example. For Medicaid, eligibility depends on factors such as state rules, household circumstances, and income. In states that have expanded Medicaid, adults with income below 138% of the federal poverty level may qualify. Many states also allow you to qualify for a premium tax credit on Marketplace health coverage if your household income is between 100% and 400% of the federal poverty level.
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Why Low-Income Guidelines Matter
Understanding what is considered to be low income matters when applying for government assistance or other programs that use income to determine eligibility. Your household size, income, location, and other factors may affect whether you qualify.
It’s also worth checking the rules for the specific program you’re interested in rather than assuming that the same income limit applies everywhere. A household that doesn’t qualify for one program based on income may still qualify for another with different eligibility requirements.
Government Assistance Programs
Many federal programs use the HSS poverty guidelines, or a percentage of those guidelines, when determining eligibility. Examples include:
• Supplemental Nutrition Assistance Program (SNAP)
• Special Supplemental Nutrition Program for Women, Infants, and Children (WIC)
• Medicaid
• Children’s Health Insurance Program (CHIP)
• Low Income Home Energy Assistance Program (LIHEAP)
• Department of Housing and Urban Development (HUD) assisted housing programs
• Some maternal and child health programs
• Low-income Home Energy Assistance
• Health Insurance Premium Tax Credits
Not every federal assistance program uses the poverty guidelines, however. Some programs have their own income limits, while others consider additional factors such as assets, age, disability, or household circumstances.
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State and Local Aid
State and local governments may offer additional assistance for households with limited income. Eligibility rules vary, and programs may use different income limits than federal programs.
Depending on where you live, assistance may be available for expenses such as food, housing, utilities, health care, transportation, or child care. Local nonprofits and community organizations may also provide resources for households that don’t qualify for government programs.
Income verification is generally required when applying for income-based assistance, so you may need documents such as pay stubs, tax returns, benefit statements, or other records showing household income.
How to Manage Your Finances on a Low Income
Managing money can be challenging when it feels like you’re just living paycheck to paycheck. Fortunately, there are strategies that can help you get a clearer picture of your finances and start working towards your goals, even on a low income.
Step 1: Track Your Monthly Income and Expenses
You might start by assessing your average monthly income and tracking exactly where that money goes each month. This can help you identify your essential expenses, recurring bills, and areas where you may have more flexibility.
You can track your spending on paper, with a spreadsheet, or with a budgeting app. The method matters less than consistently keeping tabs on your cash flow.
If your income varies from month to month, consider creating your budget around your lower-income months and adjusting it when you earn more.
Step 2: Utilize the 50/30/20 Budgeting Rule
The 50/30/20 budget rule divides your income into three buckets: 50% for needs, 30% for wants, and 20% for savings and debt repayment beyond the minimum. A 50/30/20 budget calculator can help you figure out how much of your paycheck to allocate to each category monthly.
Keep in mind, however, that these percentages are just a guideline. If money is tight, you may find that essential expenses such as housing, food, utilities, transportation and minimum debt payments take up more than half of your income. If so, you might start by identifying your essential expenses and minimum financial obligations, then determine how much remains for discretionary spending, additional debt payments, or savings.
A monthly budget calculator can help you see how much you have available for each category and where you may need to make adjustments.
Step 3: Build a Starter Emergency Fund
If you have money left over after covering your essential expenses, consider setting aside a small amount for unexpected costs. Even a modest emergency fund can give you cash to draw on for expenses such as a car repair, medical bill, or urgent household need.
You don’t need to start with a large savings goal. Putting just $5 or $10 from each paycheck into a high yield savings account can help you establish the habit and help you gradually build up a significant sum. Setting up automatic transfers can make saving easier.
Step 4: Explore Government and Community Resources
If your income doesn’t stretch far enough to cover basic expenses, consider looking for assistance before relying on high-cost borrowing or falling beyond on essential bills.
You can contact your local department of social services to learn more about government programs you may qualify for. Depending on your circumstances and location, community resources may include:
• Food banks and food pantries
• Local nonprofits that assist low-income families and individuals
• Community health centers
• Utility assistance programs
• Community and faith-based organizations
You can also call 211 or visit 211.org to find local assistance and community resources.”
The Takeaway
There isn’t one income level that defines “low income” for everyone in the U.S. The 2026 HHS poverty guideline is $15,960 for a household of one and $33,000 for a household of four in the 48 contiguous states and the District of Columbia, but many assistance programs use different income limits.
Your household size, location, and the specific program you’re applying for can all affect eligibility. If you’re living on a limited income, tracking your spending, creating a flexible budget, building savings when possible, and exploring government and community resources may help you manage your finances.
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FAQ
What is considered to be low income for a single person?
For 2026, the federal poverty guideline for a one-person household is $15,960 in the 48 contiguous states and the District of Columbia. However, this does not mean that everyone earning more than $15,960 is considered middle or high income. Government programs may use higher percentages of the federal poverty guidelines or different thresholds altogether to determine eligibility for low-income benefits. Housing programs, for example, may use local area median income (AMI), so the income considered low can vary significantly by location.
How does the government determine what is considered low income?
There is no single government definition of low income. Different programs use different income limits based on factors such as household size, location, and the type of assistance. The federal poverty guidelines are commonly used for determining eligibility for programs such as Medicaid and CHIP, while HUD uses area median income for housing programs. Some programs also use a percentage of the federal poverty guidelines, such as 125%, 150%, or 185%.
What is the difference between low income and the poverty level?
The poverty level is a specific income measure used by the federal government. The Department of Health and Human Services (HHS) poverty guidelines are based on the federal poverty measure and are used to determine eligibility for certain government programs. “Low income” is a broader term without one universal definition. Depending on the program, a household may be considered low income if its income is above the poverty guideline but below a specified percentage of the guideline or a local income limit.
Is $40,000 a year considered low income?
Whether $40,000 a year is considered low income depends on factors such as household size, location, and the program being considered. For a single person, $40,000 is above the 2026 federal poverty guideline of $15,960. However, a household of several people earning $40,000 could have an income much closer to or below certain program eligibility limits. Housing programs may also use local area median income, which can produce different income limits depending on where you live.
What are the four levels of income?
There is no official federal system that divides Americans into exactly four income levels. Income is sometimes broadly categorized as low, middle, upper-middle, and high income, but these categories can be defined differently depending on the source. Researchers may use household income relative to the national or local median to classify income groups. Government assistance programs generally don’t use these four broad categories. Instead, they rely on specific income limits based on factors such as household size, location, and the program’s eligibility requirements.
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