Need-Tested Benefits: Impact of Assistance on June 30, 2021
Poverty Experienced by Low-Income Families
Gene Falk
and Individuals
Specialist in Social Policy

Need-tested programs have received increased attention from policymakers in the past year, as
Jameson A. Carter
the COVID-19 pandemic pushed workers from jobs for extended periods and depressed
Research Assistant
employment income among many lower-income households. In response, Congress enacted a

series of changes to these and other benefit programs to provide additional income support. Most
of these changes are temporary. This report provides an overview of how need -tested benefits
Isaac A. Nicchitta
affected poverty before the pandemic, to provide an approximate picture of how these programs
Research Assistant
would operate should the economy recover as forecasted by CBO and the temporary measures in

current law expire.

Need-tested programs provide low-income families with benefits in the form of, for instance,
cash, food, housing, and child care subsidies that affect their poverty status. While all need -tested programs target families
with low income, many also restrict benefits to persons of a certain age, persons with disabilities, or persons in families with
children. This report analyzes the impact of these programs on both the prevalence of poverty (poverty rate) and the degree of
poverty (poverty gap). At the individual family level, the poverty gap is the difference (if any) between the poverty threshold
applicable to the family and its family income. At the aggregate level, the poverty gap is the sum of all individual families ’
gaps, and therefore represents the total funds needed for all families to exit poverty.
Need-tested benefits produced comparatively large reductions in the prevalence and degree of poverty among families with
children relative to other family types. Before consideration of need-tested benefits, 25.6% of all children would have lived in
poverty in 2017. Need-tested benefits reduced that poverty rate by half (see Figure S1). Need-tested benefits also reduced the
pre-benefit aggregate poverty gap among families with children by two -thirds.
Figure S1. Poverty Rates Before and After Need-Tested Benefits in 2017, by Family Type

Source: CRS estimates.
In addition to families with children, need-tested benefits produced comparatively large reductions in poverty among
childless families who had an individual with disabilities. People in families with an individual with disabilities and in
families with children also had the greatest need, as measured by the pre-benefit poverty rate and per-family median poverty
gap.
Need-tested programs produced relatively small reductions in the prevalence and degree of poverty among working-age
people ages 18 to 64 living in families with no children or adults aged 65 or older. While such people experienced relatively
low pre-benefit poverty rates and low benefit receipt, those who were living in poverty experienced relatively high degrees of
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Need-Tested Benefits: Impact of Assistance on Poverty

poverty—after benefits are counted, their families would typically require the most additional funds to exit poverty. They
also account for roughly $55 billion of the remaining $144 billion aggregate poverty gap after need-tested benefits are
received, the largest share of any family category.
Need-tested programs reduced both the prevalence and degree of poverty across all racial/ethnic groups. Before counting
need-tested benefits, 12.9% of non-Hispanic White persons would have lived in poverty, compared with 30.8% of Hispanic
persons, 31.6% of non-Hispanic Black persons, and 18.2% of Asian persons in 2017. Need-tested benefits reduced these
estimated poverty rates to 9.0% for non-Hispanic White persons, 19.3% for Hispanic persons, 18.9% for non-Hispanic Black
persons, and 13.7% for Asian persons.
Aggregate poverty gaps among the racial/ethnic groups are affected by both the typical gap for a family in poverty within that
group and the group’s size (see Figure S2). Families comprised entirely of non-Hispanic White persons represent the largest
group—and also had the largest aggregate pre-benefit poverty gap. Need-tested benefits reduced the poverty gap among non-
Hispanic White families by $41 billion (a reduction of 38%), the largest of any group. However, need -tested benefits reduced
aggregate poverty gaps for families of multiple races by 58%, non -Hispanic Black families by 57%, and Hispanic families by
51%. Asian families, the smallest of the racial/ethnic groups examined in this report, experienced a reduction of the pre -
benefit poverty gap of 31%. Still, the largest aggregate poverty gap that remained was for non -Hispanic White families ($67
billion).
Figure S2. Aggregate Poverty Gap in 2017, by Racial/Ethnic Composition of Family

Source: CRS estimates.

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Appendixes
Appendix. Data Tables ................................................................................................... 17

Contacts
Author Information ....................................................................................................... 20

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Need-Tested Benefits: Impact of Assistance on Poverty

Introduction
Need-tested programs have received increased attention from policymakers in the past year, as
the Coronavirus Disease 2019 (COVID-19) pandemic pushed workers from jobs for extended
periods1 and depressed employment income among lower-income households.2 These
deteriorating labor market conditions3 coincided with an increase in the number of families
relying on need-tested programs to meet their basic needs.4 In response, Congress provided three
rounds of direct payment one-time “stimulus checks” to families,5 expanded Unemployment
Insurance (UI) program benefits and length of coverage,6 expanded nutrition assistance
programs,7 and enacted large increases in refundable tax credits.8 Al of these policy responses are
temporary and wil expire in varying timespans without further congressional action.
This report examines the impact of need-tested benefits on the prevalence and degree of poverty
in 2017,9 a year of economic expansion before the pandemic. It does so by using estimates of the
impact of these programs as they existed at that time, under policies that the programs, without
additional legislative action, general y wil revert to once the temporary measures enacted in
response to the pandemic expire.
The need-tested programs examined in this report provide cash or in-kind benefits directly to
families, increasing those families’ disposable income. This increase can either prevent families
from living in poverty altogether or al eviate the severity of deprivation for those who live in
poverty.10 Therefore, the Congressional Research Service (CRS) estimates in this report show

1 Gabriel Chodrow-Reich and John Coglianese, Projecting Unemployment Durations: A Factor-Flows Simulation
Approach With Application to the COVID-19 Recession, National Bureau of Economic Research, Working Paper no.
27566, July 2020.
2 For more information, see CRS Insight IN11457, COVID-19 Pandemic’s Impact on Household Employment and
Incom e.
3 As of the cover date of this report, unemployment rates remain elevated above pre-pandemic levels (3.6% in
December 2019 compared to 5.8% in May 2021) and labor force participation remains depressed (63.0% in December
2019 compared to 61.6% in May 2021); Bureau of Labor Statistics, Em ploym ent Situation News Release, June 4, 2021,
https://www.bls.gov/news.release/empsit.nr0.htm.
4 For example, from the start of the declared national health emergency in January 2020 to January 2021 (the most
recent month of data for which the programs mentioned in this footnote have available data ), Supplemental Nutrition
Assistance Program (SNAP) enrollment increased by roughly 5 million and Medicaid enrollment increased by roughly
10 million. SNAP: U.S. Department of Agriculture, Food and Nutrition Services, “SNAP Data T ables,” June 11, 2021,
https://www.fns.usda.gov/pd/supplemental-nutrition-assistance-program-snap; and Medicaid: Center for Medicaid &
CHIP Services, Medicaid and CHIP Coverage Learning Collaborative, “ December 2020 and January 2021 Medicaid
and CHIP Enrollment T rends Snapshot,” April 20, 2021, https://www.medicaid.gov/medicaid/national-medicaid-chip-
program-information/downloads/december-2020-january-2021-medicaid-chip-enrollment-trend-snapshot.pdf.
5 For more information, see CRS Insight IN11605, COVID-19 and Direct Payments: Comparison of First and Second
Round of “Stimulus Checks” to the Third Round in the American Rescue Plan Act of 2021 (ARPA; P.L. 117 -2).
6 For more information, see CRS Report R46687, Current Status of Unemployment Insurance (UI) Benefits:
Perm anent-Law Program s and COVID-19 Pandem ic Response.
7 For more information, see CRS Report R46681, USDA Nutrition Assistance Programs: Response to the COVID-19
Pandem ic.
8 For more information, see CRS Report R46680, The American Rescue Plan Act of 2021 (ARPA; P.L. 117 -2): Title IX,
Subtitle G—Tax Provisions Related to Prom oting Economic Security.
9 T his report uses the year 2017 because as of June 2021 it was the latest year for which data were available to the
Congressional Research Service (CRS) that corrected for the under -reporting of benefit receipt in selected need-tested
benefit programs using the T RIM3 microsimulation model.
10 Additionally, benefits can support families who live above the poverty line. T hese programs’ eligibility rules do not
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how need-tested benefits reduce poverty by examining families’ disposable income before and
after receiving benefits and then evaluating two concepts:
 poverty rates and the number of people in poverty, which measure the prevalence
of poverty; and
 poverty gaps, which measure the degree of poverty among those who live in
poverty.
Using this method, CRS found that need-tested benefits improve family economic wel being by
reducing both the prevalence and degree of poverty, particularly for families with children. This
analysis expands on prior CRS research establishing that these programs combine into a system of
need-tested benefits that are largely received by families with children.11
Need-Tested Programs
Need-tested programs by definition are targeted to households, families, or individuals with low
incomes. They require financial resources (income and assets) to fal below a specified threshold
in order to qualify for benefits.
Need-tested benefits provide benefits in either cash or noncash forms (e.g., food, housing,
medical benefits). They sometimes subsidize the purchase of certain goods or services, and those
subsidies are considered a form of income. The refundable tax credits provide lump-sum benefits
once a year as part of federal income tax refunds. In measuring poverty status, the value of these
credits is measured as income in the year they are accrued, rather than the year they are paid. This
report evaluates the cumulative impact that the income from 10 major need-tested benefits
programs (see Table 1) have on the rate and degree of poverty.

align with the Supplemental Poverty Measure (SPM), which is the poverty measure used in this report. Rather, many
programs determine eligibility based on the U.S. Department of Health and Human Services (HHS) Poverty
Guidelines. Refundable tax credits uniquely support families who are higher up the income distribution, while the rest
of the benefits are primarily disbursed to low-income families.
11 For more information, see CRS Report R44327, Need-Tested Benefits: Estimated Eligibility and Benefit Receipt by
Fam ilies and Individuals.
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Table 1. Need-Tested Benefit Income Examined in this Report
Cash Assistance:
Supplemental Security Income (SSI) funds received once a month by individuals
and couples who are aged 65 and older, or with disabilities (including blindness).
Temporary Assistance for Needy Families (TANF) funds received once a
month by families with children.
Refundable Tax Credits:
Earned Income Tax Credit (EITC) funds received once a year by low and
middle-income working taxpayers.
Additional Child Tax Credit (ACTC) funds received once a year by low and
middle-income working taxpayers with dependent children.
Food Assistance:
Supplemental Nutrition Assistance Program (SNAP) noncash benefits
received monthly by low-income households through a card (similar to a debit card)
that can be used to purchase food.
Special Supplemental Nutrition Program for Women, Infants, and
Children (WIC) noncash benefits received monthly for low-income children under
5 or by pregnant/postpartum women, through a card that can be used to purchase
food.
Free and Reduced-Price School Lunch (FRPL) subsidies for lunches purchased
daily by low-income children in school, provided through the National School Lunch
Program.
Housing Subsidies:
Housing assistance provided to low-income households, through rent-reducing
vouchers or reduced monthly rents via the Section 8 Housing Choice Voucher
program, the project-based Section 8 rental assistance program, or the public housing
program.
Low Income Home Energy Assistance (LIHEAP) subsidies received by low-
income households to reduce heating and cooling costs.
Child Care:
Child Care and Development Fund (CCDF) subsidies received by working
parents, usual y in the form of voucher-like subsidies for recipients or contracts with
providers, to reduce the cost of child care.
Source: CRS. For more information, see CRS Report R44327, Need-Tested Benefits: Estimated Eligibility and
Benefit Receipt by Families and Individuals.
This report uses the concepts of the research Supplemental Poverty Measure (SPM) to measure
the impact of the income from these programs on poverty. The underlying population and income
data come from a U.S. Census Bureau household survey of the population, the Annual Social and
Economic Supplement (ASEC) to the Current Population Survey (CPS) for calendar year 2017.
However, the poverty rates in this report differ from those published by the U.S. Census Bureau
because, when possible, reported program income is adjusted for under-reporting of need-tested
benefits by survey respondents. These adjustments use data from the Transfer Income Model 3
(TRIM3) microsimulation model funded primarily by the U.S. Department of Health and Human
Services (HHS) and maintained at the Urban Institute. This report uses income or subsidy
estimates from TRIM3 for SSI, TANF, housing assistance, the EITC, the ACTC, SNAP, and
CCDF subsidies.12

12 For more on the analytical methods used for this report see Cite technical appendix report
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Medicaid and State Children’s Health Insurance Program (CHIP) health coverage is not counted
as income for the purposes of this report, as the SPM does not explicitly consider the value of
health insurance. Additional y, this report does not isolate the effects of social insurance, although
UI expansions have significantly al eviated poverty during the pandemic.13
In examining changes in poverty rates and poverty gaps between when need-tested benefits are
excluded versus counted, this report’s analysis does not consider behavioral changes (e.g., labor
force participation or family formation decisions) that need-tested benefits might prompt.14
Terms Used in This Report
Poverty: a state of economic need experienced by families with disposable income that is less than the poverty
threshold. Such families are occasional y described in this report as living in poverty.
Disposable Income: what the Census Bureau terms resources available to families under the research
Supplemental Poverty Measure (SPM). These resources are calculated as the sum of labor income after taxes,
interest and dividends, cash social insurance benefits (e.g., Social Security, unemployment insurance), and cash and
noncash need-tested benefits minus work expenditures and medical expenditures.
Poverty Threshold: the level of disposable income that determines whether a family is considered to be living in
poverty. If a family’s disposable income is below this threshold, that family is living in poverty. Families have varying
thresholds that depend on the cost of basic needs such as food and clothing, geographical y adjusted housing costs,
family composition, housing tenure, and other adjustments as determined by the SPM. For example, before the
geographic adjustment is applied, the 2017 threshold for a two-parent family with two children is $27,085 if they
own their home with a mortgage, $23,261 if own their home outright, and $27,005 if they are renters.
Poverty Rate: the proportion of al individuals living in poverty. CRS estimated the impact of need-tested
programs on the prevalence of poverty by calculating the poverty rate before and after need -tested benefits are
received by families. The higher the poverty rate, the higher the prevalence of poverty.
Prevalence of Need/Poverty: the poverty rate calculated either before (prevalence of need) or after
(prevalence of poverty) the application of need-tested benefits to family disposable income.
Poverty Gap: the difference between disposable income and the poverty threshold for families living in poverty
(i.e., how much extra disposable income it would take for al families living in poverty to exit poverty). CRS
evaluates the impact of need-tested benefit programs on the degree of poverty by calculating the poverty gap
before and after need-tested benefits are received. When the poverty gap is reduced, families become richer. The
greater these reductions, the greater the extent to which need-tested benefits al eviate the degree of poverty.
Degree of Need/Poverty: the poverty gap calculated either before (degree of need) or after (degree of
poverty) the application of need-tested benefits to family disposable income.
How Do Need-Tested Programs Reduce Poverty?
The need-tested programs examined in this report provide cash and in-kind benefits directly to
families, increasing those families’ disposable income. This increase can either prevent families
from living in poverty altogether or al eviate the severity of deprivation for those who live in
poverty. CRS therefore evaluated two concepts, the poverty rate and poverty gap, to capture the
varying ways in which poverty is al eviated by need-tested benefits.
CRS used the poverty rate, calculated as the percentage of people living in poverty according to
the SPM, to measure the impact need-tested benefits programs have on the prevalence of poverty.
By estimating how the poverty rate changed in response to the application of need-tested benefits

13 See Zachary Parolin, Megan A. Curran, and Christopher Wimer, The CARES Act and Poverty in the COVID-19
Crisis, Center on Poverty and Social Policy, June 2020, p.10, at https://www.povertycenter.columbia.edu/news-
internal/coronavirus-cares-act-forecasting-poverty-estimates.
14 Additionally, the SPM poverty thresholds are based on an analysis of consumption expenditures—expenditures and a
standard of living that are partially based on income received by need-tested benefits. Here too, that standard of living
is held constant.
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to families’ disposable income, CRS was able to measure their impact on the prevalence of
poverty.
CRS used another measure—the poverty gap—to further understand and examine the impact of
programs on the degree of poverty. The poverty gap is the difference between the poverty
threshold (a family is counted as living in poverty if its disposable income is below this threshold)
and a family's disposable income. This is a measure of how much extra disposable income a
given family would require to exit poverty, meaning that the poverty gap for a family living
above the poverty threshold is $0. The greater the distance between disposable income and the
poverty threshold for families living in poverty, the further they are from exiting poverty, and,
therefore, the greater the degree of their poverty. By examining the typical degree of poverty, as
measured by the median poverty gap,15 CRS estimated how much extra income families
experiencing poverty usual y require (before and after receipt of need-tested benefits) to exit
poverty.
CRS then summed the individual poverty gaps of al families living in poverty to determine the
aggregate poverty gap. In this analysis too, poverty is measured both before and after need-tested
benefits are considered. This method emphasizes how need-tested benefits as a group reduce the
degree of poverty in the United States, and how much poverty remains in dollar terms.
The following sections display the extent to which need-tested benefits reduced the prevalence
and degree of poverty before the pandemic, using the aforementioned concepts and methods.
These sections examine the overal population, and then break out findings by family category
and racial and ethnic identity.

15 T he median is the amount that divides the poverty population into two groups: one with poverty gaps less than t he
median, and one with poverty gaps more than the median. T hese groups are of equal size, meaning that half of families
living in poverty have a poverty gap more than or equal to the median, and the other half have a poverty gap less than
or equal to the median. T he median is used because it is less affected by extreme values than is the mean (commonly
called the average).
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How Do Need-Tested Programs Reduce Overall Poverty?
The following section shows that overal , need-tested benefits reduced the prevalence of poverty,
the aggregate degree of poverty of al families living in poverty, and the typical degree of poverty
among families living in poverty. Need-tested benefits reduced the degree of poverty by $123
bil ion in 2017, and in doing so lifted 21.6 mil ion people above the poverty threshold. These
benefits also reduced the typical degree of deprivation for families in poverty. If need-tested
benefits were not counted, the median family living in poverty would require roughly $9,200 in
additional income to exit poverty. When need-tested benefits are counted, the median family
remaining in poverty would require a smal er amount of $5,600 to exit poverty.
Need-tested benefits prevented 21.6 million people from living in poverty
CRS estimated that in 2017, prior to the pandemic and based on the policies that existed then,
almost one in five people (19.2%) would have been living in poverty if not for need-tested
benefits. Figure 1 displays that these benefits lifted 21.6 mil ion people above the poverty line,
decreasing the poverty rate to 12.5%.
Figure 1. Poverty Rate, With and Without Benefits
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS uses
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.
Later sections of this report show that the impacts presented in Figure 1 primarily represent
reductions in poverty rates among children, adults in families with children, and adults with
work-impairing disabilities. The sections also show that need-tested benefits disproportionately
reduce poverty rates among people identifying as Hispanic, Black, or two or more races.

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Need-tested benefits reduced the typical degree of poverty experienced by
families from roughly $9,200 to $5,600
Reductions in the prevalence and degree of aggregate poverty, however, do not reflect how a
typical family living in poverty may be impacted by need-tested benefits. Additional y, aggregate
poverty gaps are a function of both the size of the population and the typical amount that the
income of a family living in poverty fal s short of the poverty threshold. CRS therefore estimated
the median poverty gap before and after benefit receipt. Figure 2 shows that need-tested benefits
reduced the typical degree of poverty experienced by families by roughly $3,600 in 2017. The
families that were living in poverty before receipt of need-tested benefits would have typical y
required $9,241 ($770 per month) to close their family poverty gap, and exit poverty. Roughly 6.8
mil ion families did exit poverty after benefit receipt, but 20.2 mil ion did not. Families that
continued to live in poverty after counting income from need-tested benefits would have typical y
required an extra $5,644 (or roughly $470 per month) to close their family poverty gap, and exit
poverty.
Figure 2. Poverty Gap for the Typical Family Living in Poverty,
With and Without Benefits
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: This chart maps the median poverty gap before and after the application of need-tested benefits. This
means that the two data points represent two separate universes: (1) the 61.9 mil ion people who would be
living in poverty without need-tested benefits, and (2) the 40.3 mil ion people who were living in poverty with
need-tested benefits. Need-tested benefits data are not available for every program targeting low-income
families. CRS used SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC,
LIHEAP, and FRPL to calculate the impact of need-tested benefits.
Later sections of this report show that the impacts of need-tested benefits on the measure shown
in Figure 2 vary by family composition and the race of the head of the family. Need-tested
benefits reduce the median poverty gap most significantly for families with children and families
without children where an adult with disabilities is present. Additional y, need-tested benefits
reduce the median poverty gap most significantly for Black and Hispanic families.

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Need-tested benefits reduced the degree of poverty by $123 billion
CRS estimated that, in addition to reducing the prevalence of poverty, need-tested benefits
al eviated the degree of poverty by almost half in 2017. Figure 3 displays these estimates of the
poverty gap before and after need-tested benefits. After applying need-tested benefits to family
resources, the aggregate poverty gap declined from $267 bil ion to $144 bil ion, a reduction of
$123 bil ion. That is, for all families to exit poverty they would require an additional $144 bil ion
of disposable income in aggregate, and without benefits they would have needed $267 bil ion.
Figure 3. Poverty Gap, With and Without Benefits
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.
Later sections of this report show that the impacts shown in Figure 3 primarily represent families
with children and families without children where an adult with disabilities was present. The
sections also show that these impacts disproportionately affect families comprised entirely of
persons who identify as Hispanic, Black, or two or more races. Although need-tested benefits
reduced the depth of poverty by a relatively low percentage (compared to the pre-benefit gap)
among families comprised of White individuals, these families experienced the largest total
reductions from need-tested benefits.
How Do Need-Tested Benefits Reduce Poverty Among Families of
Differing Characteristics?
Each of the programs examined in this report, by definition, limit eligibility to families or
individuals with low incomes. However, many need-tested programs are also limited to families
with children, or adults of a certain age or with a disability. Of the programs examined in this
report, five provide benefits only to families with children: the ACTC (the refundable portion of
the child tax credit), TANF cash assistance, CCDF child care subsidies, WIC, and FRPL. SSI
provides monthly cash benefits to needy individuals or couples who are aged 65 and older, or
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with disabilities (including blindness). Additional y, most EITC dollars go to families with
children,16 and families with children also comprise a large share of SNAP households.17
These eligibility requirements culminate in a need-tested benefits system that largely al eviates
the prevalence and degree of poverty among children, adults with severe work disabilities, and
their respective family members.18 These are also the population groups with the greatest
prevalence of need—as measured by pre-benefit poverty rates. This elevated prevalence of need
means that despite the impact of need-tested benefits on these groups, poverty is stil more
prevalent among children (12.6%) and adults living with disabilities (29.9%) than among adults
of working age19 in families without children (11.0%), who receive relatively fewer benefits.20
Overlap in Family and Individual Groupings
For the purposes of the estimates in this report, these categories are treated as mutual y exclusive, with
individuals assigned to a single category based on “adults in families with children” having first order of
precedence. This is general y because many of need-tested benefits discussed in this report are either targeted
toward families with children or require that a family have a child to qualify (CHIP, ACTC, TANF, CCDF, School
Meals). Families with a parent with disabilities or with an adult aged 65 or older may themselves qualify or have a
spouse that qualifies for these benefits based on the presence of a child, rather than disability status or age. Note
that assigning individuals to mutual y exclusive groups creates overlap between populations—specifical y, there are
people classified as “adults in families with children” who either have a severe work-limiting disability or are aged
65 and older.
In 2017, 8.7% of adults in families with children overlapped with other categories: 4.9% of these adults were aged
18 to 64 and had a severe work disability and 3.8% were aged 65 and older. Despite this overlap, each adult was
assigned to only one group based on the rank order listed above (e.g., adults who are aged 65 and in a family with
children were classified as “adults in families with children”).
Number
Percentage of

(in thousands)
Total
Adults in families with children (total)
84,046
100.0
Adult aged 18 to 64 without a disability
76,775
91.3

16 In 2018, 97% of all EIT C dollars went to families with children; see CRS Report R43805, The Earned Income Tax
Credit (EITC): How It Works and Who Receives It.
17 In FY2017, 68% of all SNAP participants lived in households with children. See Kathryn Cronquist and Sarah
Lauffer, Characteristics of Supplem ental Nutrition Assistance Program Households: Fiscal Year 2017 , U.S.
Department of Agriculture, Alexandria, VA, 2019, p. 37, https://www.fns.usda.gov/snap/characteristics-supplemental-
nutrition-assistance-program-households-fiscal-year-2017.
18 T his report uses a definition of an individual with a work-limiting disability that is based on a method developed by
the U.S. Census Bureau. An individual is considered to have a work -limiting disability if any of the following is true:
(1) responded “Yes” to an ASEC question asking whether the individual has a health problem or disability that prevents
working; (2) responded “Yes” to an ASEC question asking whether the individual retired or left a job for a health
reason; (3) responded that the individual did not work in the mo nth of the survey because of a disability; (4) responded
to an ASEC question that the individual did not work in the prior year because of a disability; (5) was a recipient of
Medicare and under age 65; or (6) was a recipient of SSI and under age 65. T his corresponds to the definition of
severely work disabled in the document found at https://www2.census.gov/programs-surveys/demo/guidance/disability/
cpstableexplanation.pdf. Additionally, this report only considers adults who are at least 18 and under 65 as having a
work-limiting disability. Adults 65 and older and children with disabilities are not categorized alongside working-age
adults with disabilities.
19 Defined in this report as anyone who is at least 18 and under 65.
20 For more information, see CRS Report R44327, Need-Tested Benefits: Estimated Eligibility and Benefit Receipt by
Fam ilies and Individuals.
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Adult aged 18 to 64 with a severe
4,099
4.9
work disability
Adults aged 65 and older
3,172
3.8
Source: CRS, based on data from the U.S. Census Bureau’s ASEC to the CPS and the TRIM3
microsimulation model, primarily funded by HHS and maintained at the Urban Institute.
Need-tested benefits most substantially reduced the prevalence of poverty
among children and adults with disabilities
Estimates presented in Figure 4 show that in 2017, need-tested benefits reduced the prevalence of
poverty among children and adults with disabilities by the largest amounts. Except for adults with
disabilities, persons living in families without children are relatively unlikely to be lifted from
poverty by need-tested benefits.21 However, adults without disabilities living in families without
children also exhibit the comparatively lowest prevalence of pre-benefit need. While need-tested
benefits provide fairly modest support for adults aged 65 or older in families without children, a
separate CRS analysis found that Social Security (which is a form of social insurance) reduced
the prevalence of poverty among the population aged 65 and older. Without Social Security,
poverty would increase in this population by 32 percentage points.22
Figure 4. Poverty Rates, With and Without Benefits: Individuals by Family Category
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.

21 One factor contributing to this finding is that families without children are less likely to receive benefits. For more on
this see cite “W ho receives” re port.
22 For more information, see CRS Report R45791, Poverty Among the Population Aged 65 and Older.
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After counting need-tested benefits, families comprised of working-age adults
ages 18 to 64 without disabilities and with no children typically experienced the
greatest degree of poverty
Need-tested benefits significantly reduce the typical amount of funds that families would require
to exit poverty. Figure 5 shows that without need-tested benefits, the median family with children
would have required roughly $12,000 to exit poverty in 2017, and with benefits counted they
would have required $6,500. Families with an adult with disabilities and with no children would
have typical y required roughly $9,700 to exit poverty without benefits, compared to roughly
$3,900 with benefits. Other family groups experienced comparatively smal differences between
the typical degree of poverty with benefits and typical degree of poverty without benefits.
Families comprised of working-age adults ages 18 to 64 without disabilities and with no children
therefore required the most funds to exit poverty despite exhibiting a relatively low prevalence
and degree of need.
After receiving need-tested benefits, families without children, an adult with disabilities, or an
adult aged 65 or older would have typical y required an extra $7,606 (or roughly $634 per month)
to close their family poverty gap and exit poverty. These families general y tend to receive fewer
benefits.23 Families without children and with an adult aged 65 or older, who is likely to benefit
from Social Security, and families with adults with disabilities or with children, who are
specifical y targeted by benefits programs, typical y experience a lesser degree of poverty.
Figure 5. Poverty Gap for the Typical Family Living in Poverty, With and Without
Benefits, by Family Category
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.
Families with children typical y experience a lower degree of poverty than families without
children, adults with disabilities, or adults aged 65 or older. However, the typical degree of

23 CITE “Who” Report
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poverty experienced by families with children remains relatively high ($6,522, or roughly $544 a
month) considering the large aggregate amount of benefits they receive.
Need-tested benefits reduced the degree of poverty most substantially among
families with children
Aggregate poverty gaps depend on both the size of the population and the typical gap experienced
by families in a population grouping. The varying eligibility requirements of need-tested
programs produce a system in which families with pre-benefit incomes below the poverty line
who have children or include individuals with disabilities experience the greatest reduction in the
degree of poverty when they receive need-tested benefits.24
Figure 6 shows this result by displaying both the pre- and post-need-tested benefits poverty gap
by family type in 2017. Need-tested benefits most significantly reduce the aggregate degree of
poverty for families with children. These families also exhibited the greatest degree of need—as
measured by the pre-benefit poverty gap—an amount that was almost twice as large as the family
category with the second-greatest degree of need (families comprised of working-age adults
without disabilities and with no children). However, need-tested benefits decreased the degree of
poverty among families with children by such a large amount (from $116 bil ion to $39 bil ion)
that, after benefit receipt, families comprised of working-age adults without disabilities and with
no children (who, again, receive fewer benefits) accounted for the largest remaining poverty gap.
The smal benefits these families received mean that they represented 38% of the remaining
poverty gap ($55 bil ion of the $144 bil ion total), the highest share of any family category. This
section further shows that families without children and with an adult with disabilities
experienced the second largest reduction in the degree of poverty both as a share of need and in
total dollars.
Figure 6. Poverty Gap, With and Without Benefits, by Family Category
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.

24 Additionally, prior CRS analysis finds that children, adults living with children, and adults with disabilities are
relatively likely to receive at least one benefit. For more on this see cite “Who re ceives” re port.
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How Do Need-Tested Programs Reduce Poverty Among Varying
Racial and Ethnic Groups?
The impact of need-tested benefits on poverty also differs by racial identity.25 Varying eligibility
requirements associated with need-tested benefits programs intersect with differing racial and
ethnic groups in several ways. As previously discussed, 5 of the 10 need-tested benefits examined
in this report are targeted to families with children and several also require earnings to qualify for
benefits. In terms of racial/ethnic groups, a relatively large share of Hispanic families and
families of multiple races living in poverty (pre-benefit) have children,26 which might qualify
them for benefits. Racial groups in which families living in poverty are less likely to have a child,
such as White families, are also less likely to exit poverty due to need-tested benefits, as they are
less likely to qualify.
Race and Ethnicity
CRS uses responses recorded on the ASEC survey to define racial and ethnic groups. The ASEC asks respondents
to self-identify as American Indian or Alaska Native, Asian, Black or African American, Native Hawai an or Other
Pacific Islander, or White.27 Additional y, respondents may identify as more than one race or as some other race.
Hispanic ethnicity is addressed separately in another question. Therefore, persons of any racial identity can also
identify as being Hispanic.28
CRS combines these two survey questions to categorize individuals according to both their race and Hispanic
ethnicity. CRS categorizes Hispanic individuals as being Hispanic, regardless of their racial identity. Al non -
Hispanic individuals are then categorized according to their respective racial identities. Using this definition, CRS
further defines the race or ethnicity of a family by the racial or ethnic composition of the family members. If one
member reports a racial or ethnic identity that differs from their other family members, the family is categorized
as having two or more races. If al members of the family share the same racial or ethnic identity, they are
categorized as that identity.
By using compositional measures to define families’ racial and ethnic group, CRS can evaluate families of multiple
racial and ethnic identities. For example, a family comprised entirely of Black individuals, none of whom identify as
Hispanic, would be considered Black. A family comprised of both non-Hispanic Black individuals and Hispanic Black
individuals would be considered two or more races. A family comprised entirely of Hispanic Black individuals
would be considered Hispanic. It should be noted that this method of defining an individual’s racial and ethnic
group preferences Hispanic ethnicity over racial identity, which may not reflect how a respondent views their own
racial and ethnic identity.

25 T he racial identities listed in this report are taken directly from the CPS. CRS could not report results for American
Indian and Alaska Native (AIAN) and Native Hawaiian and Other Pacific Islander popula tions because of small sample
sizes in the 2018 ASEC. For these populations, estimates “based on a single-year sample would be unreliable due to the
small size of the sample that can be drawn from either population.” See U.S. Census Bureau, Current Population
Survey, 2018 ASEC Technical Docum entation , 2019, Appendix G, “ Source and Accuracy Statement,”
https://www2.census.gov/programs-surveys/cps/techdocs/cpsmar18.pdf
26 Forty-nine percent of Hispanic families living in poverty (before benefit receipt) had at least one child. Whether
these families qualify for certain benefits also depends on their work status; 42% of Hispanic families living in poverty
(before benefit receipt ) had both a child and a worker. Families comprised of members of multiple races exhibited
similar demographic patterns. CRS analysis of the CPS and T RIM3; see Table 1 and Table 2 in Appe ndix for these
results.
27 T he Census Bureau is required to categorize race in this way to comply with guidance from 1997 issued by OMB.
T hese definitions “reflect a social definition of race recognized in this country and [are] not an attempt to define race
biologically, anthropologically, or genetically.” For more information, see https://www.census.gov/topics/population/
race/about.html.
28 T he Census Bureau is required to categorize ethnicity in this way to comply with guidance from 1997 issued by
OMB. For more information, see https://www.census.gov/topics/population/hispanic-origin/about.html.
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Need-tested benefits most significantly reduced the prevalence of poverty among
persons identifying as Hispanic, Black, or two or more races
Figure 7 shows that need-tested benefits reduced poverty rates for persons identifying as
Hispanic, Black, or two or more races by a larger amount than for other racial identities in 2017.
Varying family composition and work status, state-by-state variation in benefit administration,
and take-up rates al contribute to this finding, although examination of the exact nature of these
differences is beyond the scope of this report. These population groups are also those with the
greatest prevalence of need—as measured by pre-benefit poverty rates. Before need-tested
benefits are counted, the poverty rates would have been 30.8% for Hispanic persons, 31.6% for
non-Hispanic Black persons, and 23.5% for non-Hispanics persons of two or more races. This
elevated prevalence of need means that despite the varying impact of need-tested benefits on
these groups, poverty is stil more prevalent among persons identifying as Hispanic (19.3%),
Black (18.9%), or two or more races (12.3%) than among persons identifying as White (9.0%),
who receive relatively fewer benefits.29
Figure 7. Poverty Rates, With and Without Benefits, by Racial and Ethnic Identity
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.
Families comprised entirely of Asian individuals typically required the most
funds to exit poverty
Need-tested benefits significantly reduce the typical amount of funds that families would require
to exit poverty.
Figure 8 shows that without need-tested benefits, Hispanic families living in poverty would have
typical y required roughly $10,200 to exit poverty in 2017, and with benefits they would have
required approximately $6,200. Black families living in poverty experienced a similar reduction.
White families living in poverty would have typical y required roughly $7,900 to exit poverty

29 For more information, see CRS Report R44327, Need-Tested Benefits: Estimated Eligibility and Benefit Receipt by
Fam ilies and Individuals.
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without benefits, and $5,300 with benefits. Asian families would have required the most funds to
exit poverty, despite their relatively low prevalence and aggregate degree of poverty. Persons
identifying as Asian benefit the least from the programs examined in this report, as measured by
commensurate reductions in both the prevalence and degree of poverty. This may be related to the
relatively low percentage of Asian families living in poverty who have both a child and a worker
or an adult with disabilities, among other factors.
After receiving need-tested benefits, the typical family in most racial/ethnic groups would have
required an amount closer to $5,000 to exit poverty. The exceptions were Hispanic families, with
a median poverty gap of $6,169 (roughly $517 per month), and Asian families, with a median
poverty gap of $9,911 (roughly $820 per month).
Figure 8. Poverty Gap for the Typical Family Living in Poverty, With and Without
Benefits, by Racial and Ethnic Composition of Family
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.
Need-tested benefits reduced the degree of poverty in families across racial and
ethnic identities
Benefits cut the degree of poverty among Hispanic, Black, and multiple race families in half in
2017, while Asian families received relatively lower aggregate benefits in terms of dollars.
Figure 9 displays these estimates. After need-tested benefits are applied, and despite large dollar
reductions in the aggregate poverty gap, non-Hispanic White families represented almost half of
the remaining poverty gap ($67 bil ion of $144 bil ion). This is partial y a result of non-Hispanic
White families being the largest racial/ethnic group.
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Figure 9. Poverty Gap, With and Without Benefits, by Racial and Ethnic Composition
of Family
Based on 2017 Income and Population Data

Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.

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Appendix. Data Tables
Table 1. Percentage of Families With Children Living in Poverty, With and Without
Benefits, by Racial and Ethnic Composition of Family and Overall
Based on 2017 Income and Population Data
Race or Ethnicity
With Need-Tested Benefits
Without Need-Tested Benefits
Hispanic
39% of Hispanic families living in poverty 49% of Hispanic families living in poverty
(after benefit receipt) had at least one
(before benefit receipt) had at least one
child.
child.
Non-Hispanic Black
24%
35%
Non-Hispanic Asian
22%
29%
Non-Hispanic Two or
46%
60%
more Races
Non-Hispanic White
14%
21%
Total Population
23%
33%
Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Families are defined as the SPM resource unit. Child is defined as any person under 18. CRS could not
provide estimates for American Indian or Alaska Native (AIAN) or Hawai an or Pacific Islander popula tions due
to smal sample sizes. This table therefore does not add up to the total population, in which AIAN and Hawai an
or Pacific Islander populations are included. Need-tested benefits data are not available for every program
targeting low-income families. CRS used SSI, SNAP, refundable tax credits, housing assistance, child care
subsidies, TANF, WIC, LIHEAP, and FRPL to calculate the impact of need-tested benefits.
Table 2. Percentage of Families with Children and Workers Living in Poverty, With
and Without Benefits, by Racial and Ethnic Composition of Family and Overall
Based on 2017 Income and Population Data
Race or Ethnicity
With Need-Tested Benefits
Without Need-Tested Benefits
Hispanic
31% of Hispanic families living in poverty 42% of Hispanic families living in poverty
(after benefit receipt) have at least one
(before benefit receipt) have at least
child and at least one worker.
one child and at least one worker.
Non-Hispanic Black
14%
25%
Non-Hispanic Asian
16%
23%
Non-Hispanic Two or
33%
49%
more Races
Non-Hispanic White
8%
16%
Total Population
16%
26%
Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Families are defined as the SPM resource unit. Child is defined as any person under 18. Workers are
defined as anyone age 15 or older working ful or part-time for any length of time during the year. CRS could not
provide estimates for American Indian or Alaska Native (AIAN) or Hawai an or Pacific Islander populations due
to smal sample sizes. This table therefore does not add up to the total population, in which AIAN and Hawai an
or Pacific Islander populations are included. Need-tested benefits data are not available for every program
targeting low-income families. CRS used SSI, SNAP, refundable tax credits, housing assistance, child care
subsidies, TANF, WIC, LIHEAP, and FRPL to calculate the impact of need-tested benefits.
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Table 3. Person-Level Poverty Metrics, With and Without Benefits, by Family
Category and Overall
Based on 2017 Income and Population Data
Family Category
With Need-Tested Benefits
Without Need-Tested Benefits
Adults aged 18 to 64 with
29.9% of adults aged 18 to 64 with
43.1% of adults with disabilities aged 18
disabilities and without
disabilities lived in poverty, which amounts
to 64 would have lived in poverty
children
to 4.0 mil ion people.
without benefits, which amounts to 5.8
mil ion people.
Children
12.6%
25.6%
9.3 mil ion people
19.0 mil ion people
Adults (al ages) in families
10.4%
19.8%
with children
8.7 mil ion people
16.6 mil ion people
Adults aged 65 or older
14.2%
16.7%
6.8 mil ion people
8.0 mil ion people
Adults aged 18 to 64
11.0%
12.1%
without disabilities and
11.5 mil ion people
12.5 mil ion people
without children
Total Population
12.5%
19.2%
40.3 mil ion people
61.9 mil ion people
Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits.
Table 4. Person-Level Poverty Metrics, With and Without Benefits, by Racial and
Ethnic Identify and Overall
Based on 2017 Income and Population Data
Race or Ethnicity
With Need-Tested Benefits
Without Need-Tested Benefits
Hispanic
19.3% of Hispanic individuals lived in
30.8% of Hispanic individuals would have
poverty, which amounts to 11.4 mil ion
lived in poverty without benefits, which
people.
amounts to 18.2 mil ion people.
Non-Hispanic Black
18.9%
31.6%
7.5 mil ion people
12.5 mil ion people
Non-Hispanic Asian
13.7%
18.2%
2.6 mil ion people
3.4 mil ion people
Non-Hispanic Two or
12.3%
23.5%
more Races
780 thousand people
1.5 mil ion people
Non-Hispanic White
9.0%
12.0%
17.5 mil ion people
25.2 mil ion people
Total Population
12.5%
19.2%
40.3 mil ion people
61.9 mil ion people
Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: CRS could not provide estimates for American Indian or Alaska Native (AIAN) or Hawai an or Pacific
Islander populations due to smal sample sizes. This table therefore does not add up to the total population, in
which AIAN and Hawai an or Pacific Islander populations are included. Need-tested benefits data are not
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available for every program targeting low-income families. CRS used SSI, SNAP, refundable tax credits, housing
assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to calculate the impact of need-tested benefits.
Table 5. Family-Level Poverty Gaps, With and Without Benefits, by Family Category
and Overall
Based on 2017 Income and Population Data
Family Category
With Need-Tested Benefits
Without Need-Tested Benefits
Families with children
Families with children experienced a
Families with children would have
poverty gap of $39 bil ion, and the
experienced a $116 bil ion poverty gap
median poverty gap among these
without benefits, and the median
families was $6,522
poverty gap among these families
would have been $11,958
Families without children with $25 bil ion poverty gap
$55 bil ion poverty gap
an adult aged 18 to 64 with
$3,917 median
$9,692 median
disabilities
Families without children with $24 bil ion poverty gap
$33 bil ion poverty gap
an adult aged 65 or older
$3,941 median
$5,319 median
Families without children, an
$55 bil ion poverty gap
$62 bil ion poverty gap
adult aged 18 to 64 with
$7,606 median
$8,526 median
disabilities, or an adult aged
65 or older
Total
$144 bil ion poverty gap
$267 bil ion poverty gap
$5,644 median
$9,241 median
Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Notes: Need-tested benefits data are not available for every program targeting low-income families. CRS used
SSI, SNAP, refundable tax credits, housing assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to
calculate the impact of need-tested benefits. The aggregate poverty gap may not sum to total due to rounding.
Table 6. Family-Level Poverty Gaps, With and Without Benefits, by Racial and Ethnic
Composition of Family and Overall
Based on 2017 Income and Population Data
Family Category
With Need-Tested Benefits
Without Need-Tested Benefits
Non-Hispanic White
Families comprised entirely of White
These families would have
individuals experienced a poverty gap of experienced a $108 bil ion poverty gap
$67 bil ion, and the median poverty gap
without benefits, and the median
among these families was $5,305
poverty gap among these families
would have been $7,897
Non-Hispanic Black
$24 bil ion poverty gap
$56 bil ion poverty gap
$5,116 median
$10,039 median
Hispanic
$30 bil ion poverty gap
$62 bil ion poverty gap
$6,169 median
$10,182 median
Non-Hispanic Asian
$12 bil ion poverty gap
$18 bil ion poverty gap
$9,911 median
$11,978 median
Non-Hispanic Two or more
$8 bil ion poverty gap
$20 bil ion poverty gap
Races
$5,533 median
$9,387 median
Total
$144 bil ion poverty gap
$267 bil ion poverty gap
$5,644 median
$9,241 median
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Source: CRS analysis of the SPM using the TRIM3-adjusted 2018 ASEC to the CPS.
Note: CRS could not provide estimates for American Indian or Alaska Native (AIAN) or Hawai an or Pacific
Islander populations due to smal sample sizes. This table therefore does not add up to the total poverty gap, in
which AIAN and Hawai an or Pacific Islander populations are included. Need-tested benefits data are not
available for every program targeting low-income families. CRS used SSI, SNAP, refundable tax credits, housing
assistance, child care subsidies, TANF, WIC, LIHEAP, and FRPL to calculate the impact of need-tested benefits.

Author Information

Gene Falk
Isaac A. Nicchitta
Specialist in Social Policy
Research Assistant

Jameson A. Carter

Research Assistant

Acknowledgments
CRS Graphics Specialist Amber Wilhelm designed and created the graphics in this report.

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
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under the direction of Congress. Information in a CRS Report should n ot be relied upon for purposes other
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