Social Security Programs in the United States

Appendix V: Poverty Guidelines

The Federal poverty guidelines are used to determine financial eligibility for assistance or services under certain Federal programs. The guidelines are a simplified version of the Federal Government's official statistical poverty thresholds, which were originally developed in the mid-1960's by the Social Security Administration. The thresholds are now updated annually by the Census Bureau and are used for statistical purposes (for example, to determine the number of persons in poverty and to present data classifying them by type of residence, race, and other social, economic, and demographic characteristics). The poverty guidelines, which are derived from the poverty thresholds, are issued by the Department of Health and Human Services and are used for administrative purposes (for example, as an eligibility criterion for a number of Federal programs).

Both thresholds and guidelines are a series of income levels, with different values for family units of different sizes, below which the family units are considered poor.

Since 1973, the guidelines have been computed by increasing the Census Bureau's weighted average poverty thresholds by the most recently available year-to-year percentage change in the Consumer Price Index for All Urban Consumers (CPI-U). For a family of four, the resulting value is rounded to the next higher multiple of $50; for family sizes above and below four, guidelines are computed by adding or subtracting equal dollar amounts derived from the average difference between adjusted threshold figures for different family sizes (rounded to the nearest multiple of $20).

Federal poverty guidelines, March 1997 1
Family size The 48 contiguous States and the District of Columbia Alaska Hawaii
1 $7,890 $9,870 $9,070
2 10,610 13,270 12,200
3 13,330 16,670 15,330
4 16,050 20,070 18,460
5 18,770 23,470 21,590
6 21,490 26,870 24,720
7 24,210 30,270 27,850
8 26,930 33,670 30,980
1 For family units with more than eight members, add the following amount for each additional family member: $2,720 in the 48 contiguous States and District of Columbia; $3,400 in Alaska; and $3,130 in Hawaii.

Federal Poverty Guidelines

A single set of guidelines applies to the 48 contiguous States and the District of Columbia. There are separate sets of poverty guidelines for Alaska and for Hawaii reflecting Office of Economic Opportunity administrative practice beginning in the 1966–70 period. (Note that the poverty thresholds—the original version of the poverty measure—have never had separate figures for Alaska and Hawaii.)

Some programs use the poverty guidelines as only one of several eligibility criteria, or use a modification of the guidelines. For example, the eligibility level may be set at 130% or 185% of the guidelines rather than 100%. Other programs, although not using the guidelines as a criterion of individual eligibility, use them for the purpose of targeting assistance or services. The guidelines become effective on the date they are published in the Federal Register (unless an office administering a program using the guidelines specifies a different effective date for that particular program) and remain in effect until the next update is issued.

Poverty guidelines, or percentage multiples of them, are used as an eligibility criterion by a number of Federal programs, including the following:

The following Federal programs do not use the poverty guidelines in determining eligibility: