The Temporary Assistance for Needy Families (TANF) Block Grant: A Primer on TANF Financing and Federal Requirements

January 8, 2007 – August 14, 2023 RL32748

The Temporary Assistance for Needy Families
August 14, 2023
(TANF) Block Grant: A Primer on TANF
Gene Falk
Financing and Federal Requirements
Specialist in Social Policy

The Temporary Assistance for Needy Families (TANF) block grant provides federal grants to the
50 states, the District of Columbia, and the territories (collectively referred to as “states” in

TANF), as well as American Indian tribes for a wide range of benefits, services, and activities. It
was created in the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA; P.L. 104-193).
That law ended the cash assistance program for needy families with dependent children and several related programs, folding
their funding into the broad-purpose TANF block grant. At the federal level, TANF is administered by the Department of
Health and Human Services (HHS). Though PRWORA was enacted almost three decades ago, the legacy of the pre-TANF
programs is still present in TANF’s funding and in current issues related to the block grant.
TANF is financed through both federal grants and state dollars. The basic federal grant amount and minimum state amounts
are set by law, based on expenditures in the pre-TANF programs in the early- to mid-1990s, and have not been adjusted for
inflation or other changes in circumstances. TANF has a basic federal block grant to states and tribes that totals $16.5 billion.
It also requires states to contribute nonfederal dollars in what is known as a maintenance of effort (MOE) requirement based
on spending in the pre-TANF programs in FY1994.
TANF is not a program per se; rather, it is a set of funding streams used at the state and local levels to provide a wide range
of benefits, services, and activities with the general aim of ameliorating the effects, or addressing the root causes, of
childhood economic disadvantage. The benefits, services, and activities funded by federal TANF and state MOE funds
represent a broader set of activities, available to a wider population, than what was funded in the replaced cash assistance and
related programs. TANF funds child care; refundable tax credits for families; services for children who experienced, or are at
risk of, abuse and neglect; pre-kindergarten programs; programs for adolescents; and workforce development for needy
adults and older youth, among other activities.
Most of the federal policy around TANF relates to when funds are spent on assistance. Federal TANF policy restricts
assistance to families with children or families with a pregnant individual who are financially needy. Childless adults and
couples are ineligible (unless they are pregnant), though noncustodial parents may be eligible for benefits and services.
Assistance is often, but not exclusively, provided in the form of a monthly cash benefit.
The major requirements affecting families receiving assistance are the following:
• work requirements, most notably performance standards that states must meet, and a requirement that
states sanction a family with a member who refuses to work or participate in activities;
• a five-year time limit on assistance paid from federal grants to families that have an adult or minor child
head of household; and
• child support requirements, including assigning (i.e., legally turning over) support collected on behalf of
a family receiving assistance, and requiring that the family cooperate in establishing paternity.
States that do not meet requirements related to families receiving assistance are at risk of being penalized through a reduction
in their block grant.
Though assistance is limited to families that are financially needy, states and tribes determine the specific financial eligibility
rules and benefit amounts. States and tribes also have flexibility in implementing how work requirements and time limits
apply to individual recipients.
Congressional Research Service

The TANF Block Grant: A Primer on TANF Financing and Federal Requirements

Introduction
The Temporary Assistance for Needy Families (TANF) block grant provides federal grants for a
wide range of benefits and activities. It was created in the Personal Responsibility and Work
Opportunity Reconciliation Act of 1996 (PRWORA, P.L. 104-193). That law ended the public
assistance program for needy families with dependent children (Aid to Families with Dependent
Children [AFDC]) and several related programs, folding their funding into the broad-purpose
TANF block grant.
At the federal level, TANF is administered by the Department of Health and Human Services
(HHS). TANF programs operate in all 50 states, the District of Columbia, Puerto Rico, Guam,
and the U.S. Virgin Islands. American Samoa is eligible to operate a TANF program, but has not
opted to do so.1 The Social Security Act designates all these jurisdictions as “states,” and thus that
term will be used for them in this report.2 Federally recognized Indian tribes may also operate
TANF programs. Tribal TANF programs are funded through allocations made from the TANF
basic block grant to the state in which the tribe offers TANF benefits and services. It is the states
and the tribes that provide TANF benefits and services to families and individuals.
This report provides an overview of TANF financing and rules for state programs, describing the
following:
• federal TANF grants and state funds under a maintenance of effort (MOE)
requirement;
• how federal TANF and state MOE funds may be used to help achieve the purpose
and goals of the TANF block grant;
• rules that apply when TANF or MOE funds are used to provide assistance to
needy families with children;
• how Indian tribes may operate their own programs; and
• certain accountability requirements, including requirements that states submit
plans and report data to the federal government.
For data and statistics on the TANF block grant, see CRS Report RL32760, The Temporary
Assistance for Needy Families (TANF) Block Grant: Responses to Frequently Asked Questions.
For the legislative history of TANF, see CRS Report R44668, The Temporary Assistance for
Needy Families (TANF) Block Grant: A Legislative History.
When PRWORA ended the AFDC cash assistance program for families with children, it also
ended associated programs such as Emergency Assistance (EA), the Job Opportunities and Basic
Skills (JOBS) Training program, and AFDC-related child care. Though TANF was created almost
three decades ago, its funding is rooted in expenditures within those pre-TANF programs in the
early- to-mid 1990s. Much of its policy reflects a response to prior debates over what impact
providing cash assistance to needy families with children under the pre-TANF programs had on
the behavior of parents vis-a-vis work and marriage. Some of the current controversies over
TANF stem from the fact that the benefits, services, and activities funded by federal TANF and
MOE funds represent a broader set of activities, available to a wider population, than what was
funded in the replaced cash assistance and related programs.

1 American Samoa was also eligible to operate AFDC, but did not have such a program.
2 Section 1101(a)(1) of the Social Security Act.
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The TANF Block Grant: A Primer on TANF Financing and Federal Requirements

TANF Funding Levels
As noted above, TANF funding is based on the expenditures made in the early-to-mid 1990s in
the programs it replaced. These programs were matching grant programs, and the federal
government reimbursed states for a share of the expenditures in them. The largest program,
AFDC, reimbursed states for assistance benefits at the Medicaid matching rate, which varied by
state and ranged from a statutory minimum 50% match rate for the states that had the highest per-
capita incomes to a statutory maximum 83% match rate for states that had the lowest per-capita
incomes. Thus, there were considerable state dollars spent in the pre-TANF programs. The
matching grant for AFDC was open-ended; that is, there was no limit to federal AFDC funding
for the 50 states and District of Columbia (there were limits for Puerto Rico, Guam, and the U.S.
Virgin Islands).
Basic TANF Funding
The basic TANF block grant provided from federal funds to states and tribes is based on the
federal share of expenditures in the pre-1996 programs. To prevent states from sharply reducing
their own spending on needy children when TANF was created, the law added the MOE
requirement for states to expend nonfederal funds. The minimum spending under the MOE
requirement was based on the state share of expenditures in the pre-TANF programs. Neither the
TANF basic block grant nor the MOE have subsequently been adjusted for inflation or other
changes in national or state circumstances, such as population. Current basic TANF funding is
based on expenditures in the early- and mid-1990s.
State Family Assistance Grant
The amount states receive in basic federal TANF block grant funding, known as the State Family
Assistance Grant (SFAG), is established by a formula in federal law. The current formula for the
SFAG sets the amount for each state based on its proportional share of SFAG funds in FY2002.
The FY2002 grant, in turn, was based on a more complex formula enacted in PRWORA. The
original PRWORA formula computed each state’s grant based on the federal share of
expenditures in its AFDC, EA, and JOBS programs between FY1992 and FY1995, with the
SFAG computed as the peak expenditures during that period.3 The early- to mid-1990s
represented the historical high for the number of families receiving AFDC assistance as well as
for expenditures on AFDC and related programs. Starting with FY2017, the total basic SFAG
funding amount is reduced by 0.33% to set aside funding for TANF-related research and
evaluation.
Tribes operating a tribal TANF program within a state receive funding out of the state’s SFAG
(i.e., the tribal funding reduces the state’s SFAG). The amount of the tribal grant is the amount
spent in the area served by the tribe in FY1994. Tribes may opt at any time to seek to operate
their own program and may also terminate a program at any time. Therefore, tribal grants and the
amounts paid to states after reductions for tribal grants can change from year-to-year.

3 Under the original formula, the national total grant to states and each state’s individual grant were based on the
federal share of expenditures in the AFDC, EA, and JOBS programs. The formula entitled each state to the greatest of
the average federal share of expenditures in these programs for FY1992 through FY1994; the federal share of
expenditures for these programs in FY1994, adjusted for states that amended their EA programs in FY1994 or FY1995;
or the federal share of expenditures for these programs in FY1995. The FY1994 adjustment for EA program
amendments is the amount by which the federal share of EA expenditures in FY1995 exceeded that of FY1994.
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Table 1 shows the SFAG by state, including the division of SFAG between the portion for tribes
and the portion for the state, for FY2021 (the latest year for which data are publicly available).
For more on tribal TANF, see the “Tribal TANF” section.
Note that grants paid to states and tribes are also reduced for any penalties assessed on them for
violating a statutory TANF prohibition or failure to meet a requirement (such as the work
participation standard requirement). The SFAG shown in Table 1 is not reduced for any penalties
taken in FY2021.
The appropriation for the SFAG is included in authorizing law, though in recent years it has
typically been extended through continuing resolutions and in the final appropriation action for
Congress during a year.4 The block grant is considered mandatory spending, as federal law
entitles each state to a specific allocation. The SFAG is payable in quarterly installments to the
states.
Table 1. State Family Assistance Grants by State, FY2021
(in millions of dollars)
State Family Assistance
State Family
Tribal Family Assistance
Grant After Reductions for
State
Assistance Grant
Grant
Tribal Grants
Alabama
$93.007
$0.000
$93.007
Alaska
63.399
19.002
44.397
Arizona
221.686
22.279
199.407
Arkansas
56.546
0.000
56.546
California
3,721.496
87.180
3,634.316
Colorado
135.608
0.000
135.608
Connecticut
265.908
0.000
265.908
Delaware
32.184
0.000
32.184
District Of Columbia
92.304
0.000
92.304
Florida
560.484
0.000
560.484
Georgia
329.650
0.000
329.650
Hawaii
98.578
0.000
98.578
Idaho
31.833
1.525
30.307
Il inois
583.126
0.000
583.126
Indiana
206.117
0.000
206.117
Iowa
131.091
0.533
130.558
Kansas
101.595
0.117
101.478
Kentucky
180.689
0.000
180.689
Louisiana
163.431
0.000
163.431
Maine
77.863
0.000
77.863
Maryland
228.342
0.000
228.342

4 Recent extension of TANF funding in continuing resolutions and omnibus appropriations is chronicled in CRS Report
R44668, The Temporary Assistance for Needy Families (TANF) Block Grant: A Legislative History.
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The TANF Block Grant: A Primer on TANF Financing and Federal Requirements

State Family Assistance
State Family
Tribal Family Assistance
Grant After Reductions for
State
Assistance Grant
Grant
Tribal Grants
Massachusetts
457.855
0.000
457.855
Michigan
772.794
0.000
772.794
Minnesota
267.101
7.531
259.569
Mississippi
86.481
0.000
86.481
Missouri
216.335
0.000
216.335
Montana
45.384
7.495
37.889
Nebraska
57.837
1.210
56.627
Nevada
43.832
0.069
43.762
New Hampshire
38.394
0.000
38.394
New Jersey
402.702
0.000
402.702
New Mexico
125.687
15.767
109.920
New York
2,434.869
0.000
2,434.869
North Carolina
301.242
0.805
300.438
North Dakota
26.313
0.000
26.313
Ohio
725.566
0.000
725.566
Oklahoma
147.525
9.517
138.008
Oregon
167.370
1.535
165.835
Pennsylvania
717.125
0.000
717.125
Rhode Island
94.708
0.000
94.708
South Carolina
99.638
0.000
99.638
South Dakota
21.821
0.614
21.207
Tennessee
190.892
0.000
190.892
Texas
484.652
0.000
484.652
Utah
76.576
1.220
75.356
Vermont
47.197
0.000
47.197
Virginia
157.763
0.000
157.763
Washington
402.997
24.010
378.988
West Virginia
109.813
0.000
109.813
Wisconsin
317.138
4.292
312.846
Wyoming
21.710
3.281
18.429
Puerto Rico
71.326
0.000
71.326
Guam
3.454
0.000
3.454
U.S. Virgin Islands
2.837
0.000
2.837
Totals
16,511.872
207.982
16,303.890
Source: Congressional Research Service (CRS), based on data from the U.S. Department of Health and Human
Services (HHS), Administration for Children and Families, Office of Family Assistance.
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Notes: SFAG payable to the state may be further reduced for any penalties for failure to meet a TANF
requirement (see the “Enforcing Prohibitions and Requirements” section).
Maintenance of Effort Requirement
TANF’s MOE requirement, which states must meet or they receive a reduced block grant, sets a
minimum amount of nonfederal expenditures for TANF-related populations and activities. Like
federal SFAG funding, the state MOE requirement is based on historical expenditures and has not
been adjusted for inflation or other changes in circumstances.5 The MOE threshold can change
from year-to-year. For example, if a state contributes from its own funds to a tribe in the state
operating a tribal TANF program, that contribution is subtracted from the FY1994 expenditures
that determine the MOE threshold. Tribes may opt in and opt out of operating their programs at
any time. However, most of the year-to-year differences in the MOE threshold depend on whether
the state met its work participation standard. (For more information on the work participation
standard, see the “Work Participation Standards” section) To meet the MOE requirement, state
expenditures must be at least 80% of the state’s spending in AFDC, EA, JOBS, and AFDC-related
child care programs in FY1994 (the spending in those programs is termed historical state
spending). The percentage is lowered to 75% for states that achieved their work participation
standards.
Table 2 shows MOE requirements by state for FY2021. It lists for each state what the minimum
spending level would be at both the 80% and 75% levels of historical spending, and then the
effective minimum state spending level based on whether or not the state met its TANF work
participation standards. For example, the first four states did meet their work participation
standards, so their MOE is based on 75% of historical state spending. California is the first state
in the table not to meet its work standard (it failed the “two parent” standard) and hence its MOE
is based on 80% of historical state spending. The sum of the minimum state spending levels for
all states was approximately $10.6 billion in FY2021.
Table 2. State Maintenance of Effort Thresholds, FY2021
(in millions of dollars)
State Met
the FY2021
At 80% of
At 75% of
TANF Work
Historical State
Historical State Participation
Final MOE
State
Spending
Spending
Standards?
Requirement
Alabama
$41.828
$39.214
Yes
$39.214
Alaska
36.559
34.274
Yes
34.274
Arizona
91.176
85.478
Yes
85.478
Arkansas
22.228
20.839
Yes
20.839
California
2,840.532
2,662.999
No
2,840.532
Colorado
88.396
82.871
Yes
82.871
Connecticut
195.649
183.421
Yes
183.421
Delaware
23.222
21.771
Yes
21.771
District Of Columbia
75.146
70.449
Yes
70.449

5 The only change to the SFAG was a reduction in the total and each state’s grant of 0.33% to fund research and
evaluation activities. That change, made by P.L. 115-31, was effective beginning in FY2017.
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The TANF Block Grant: A Primer on TANF Financing and Federal Requirements

State Met
the FY2021
At 80% of
At 75% of
TANF Work
Historical State
Historical State Participation
Final MOE
State
Spending
Spending
Standards?
Requirement
Florida
392.921
368.363
No
392.921
Georgia
184.926
173.369
Yes
173.369
Hawaii
75.893
71.150
No
75.893
Idaho
13.891
13.023
Yes
13.023
Il inois
458.761
430.088
Yes
430.088
Indiana
121.094
113.526
Yes
113.526
Iowa
65.825
61.711
Yes
61.711
Kansas
65.790
61.678
Yes
61.678
Kentucky
71.913
67.418
Yes
67.418
Louisiana
59.109
55.415
Yes
55.415
Maine
40.026
37.524
Yes
37.524
Maryland
188.763
176.965
No
188.763
Massachusetts
382.877
358.948
Yes
358.948
Michigan
499.753
468.518
Yes
468.518
Minnesota
186.322
174.677
Yes
174.677
Mississippi
23.173
21.724
Yes
21.724
Missouri
128.129
120.121
Yes
120.121
Montana
13.995
13.121
Yes
13.121
Nebraska
29.899
28.031
Yes
28.031
Nevada
27.145
25.449
No
27.145
New Hampshire
34.256
32.115
Yes
32.115
New Jersey
320.171
300.160
Yes
300.160
New Mexico
34.839
32.661
No
34.839
New York
1,833.150
1,718.578
Yes
1,718.578
North Carolina
164.015
153.764
No
164.015
North Dakota
9.674
9.069
Yes
9.069
Ohio
416.887
390.831
Yes
390.831
Oklahoma
61.119
57.299
Yes
57.299
Oregon
97.503
91.409
No
97.503
Pennsylvania
434.267
407.126
Yes
407.126
Rhode Island
64.392
60.367
No
64.392
South Carolina
38.322
35.927
Yes
35.927
South Dakota
9.096
8.527
Yes
8.527
Tennessee
88.331
82.810
Yes
82.810
Texas
251.441
235.726
Yes
235.726
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State Met
the FY2021
At 80% of
At 75% of
TANF Work
Historical State
Historical State Participation
Final MOE
State
Spending
Spending
Standards?
Requirement
Utah
26.547
24.888
Yes
24.888
Vermont
27.253
25.550
Yes
25.550
Virginia
136.718
128.173
Yes
128.173
Washington
272.909
255.852
Yes
255.852
West Virginia
34.446
32.294
Yes
32.294
Wisconsin
178.067
166.938
Yes
166.938
Wyoming
9.657
9.054
No
9.657
Puerto Rico
22.598
21.185
Yes
21.185
Guam
0.947
0.888
No
0.947
U.S. Virgin Islands
0.628
0.589
Yes
0.589

Totals
11,012.175
10,323.914
10,567.452
Source: Congressional Research Service (CRS), based on data from the U.S. Department of Health and Human
Services (HHS), Administration for Children and Families, Office of Family Assistance.
Notes: Historical state spending amounts include deductions for any state contributions to tribal programs.
Table 2 shows minimum funding levels. However, there are also incentives for states to expend
funds in excess of the MOE requirement. Additional expenditures are required for states to draw
TANF contingency funds (see the “TANF Contingency Fund” section) and a state may receive
credit against its work participation standard (see the “Work Participation Standards” section) for
spending extra funds.
Why are there different base years for the federal SFAG and the
state TANF MOE?
Though both the TANF SFAG and the TANF MOE requirement amounts are based on historical expenditures in
pre-TANF programs, they do differ in the base years used to determine them. The SFAG is based on the federal
share of expenditures in FY1992 through FY1995, and the MOE is based on the state share of expenditures in
FY1994. This difference has its origins in the legislative history of H.R. 4, from the 104th Congress in 1995. The
House-passed version of H.R. 4 would have based the SFAG on peak expenditures in FY1992 through FY1994.
The House-passed version of TANF in 1995 did not have an MOE requirement. When the bil was taken up in the
Senate, the formula for the SFAG differed and was based entirely on FY1994 expenditures. The MOE requirement
was added on the Senate floor and also used FY1994 expenditures. (Another amendment slightly modified the
SFAG formula before Senate passage, to provide additional funds for certain states based on FY1995
expenditures.)
When the House and Senate versions of the bil were reconciled, the conference adopted the House SFAG
formula, modified to use expenditure data for all states from FY1995. The conference also adopted the Senate
MOE provision, which retained the FY1994 base for the MOE requirement.
H.R. 4, and a reconciliation bil that included much of its content (H.R. 2491), were vetoed by President Clinton.
However, it formed the basis for the reconciliation bil that was taken up in 1996 (H.R. 3734), which was
eventually enacted as PRWORA. For TANF’s legislative history, see CRS Report R44668, The Temporary Assistance
for Needy Families (TANF) Block Grant: A Legislative History.
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TANF Contingency Fund
The fixed basic grant under TANF led to concerns that funding might be inadequate during
economic downturns. PRWORA established a $2 billion TANF contingency fund to provide extra
funding for economically needy states. The original $2 billion in this fund was depleted in early
FY2010.6 Since FY2010, Congress has provided appropriations that continue to fund the TANF
contingency fund. Beginning in FY2017, the annual appropriation for the contingency fund has
been $608 million.
Contingency funds are only available to the 50 states and District of Columbia. Tribes and Puerto
Rico, Guam, and the U.S. Virgin Islands are ineligible for contingency fund grants.
Qualifying for TANF Contingency Funds
To draw upon contingency funds, a state must meet two conditions:
1. be considered economically needy; and
2. meet a state spending requirement, separate from the state spending requirement
under the regular TANF MOE.
Economically Needy
For purposes of the TANF contingency fund, a state meets the test of economic need if
• its seasonally adjusted unemployment rate averaged over the most recent three-
month period is at least 6.5% and is at least 10% higher than its rate in the
corresponding three-month period in either of the previous two years; or
• its number of Supplemental Nutrition Assistance Program (SNAP, formerly
known as food stamps)7 participants over the most recent three-month period is at
least 10% higher than the adjusted number of participants in the corresponding
three-month period in FY1994 or FY1995. For this purpose, FY1994 and
FY1995 participation numbers are adjusted by subtracting out an estimate of
participants who would have been made ineligible for SNAP under PRWORA
had it been in effect in those years. The major group made ineligible was
noncitizens.
State Spending Requirement
To receive contingency funds, a state is required to expend within TANF at least 100% of what it
spent in FY1994 on AFDC, EA, and JOBS. The expenditures that count toward the contingency
fund state spending requirement are the same types of expenditures that count toward the TANF
MOE, except for MOE expenditures on child care. The requirement that contingency fund MOE
expenditures be within TANF means that MOE spending in Separate State Programs (SSPs) is not
countable toward the contingency fund state spending requirement. (For a discussion of
expenditures in SSPs, see the “Summing Up the Rules: Financing a Benefit, Service, or Activity”
section.)

6 For FY2009 and FY2010, states were able to draw additional TANF funds from a temporary emergency contingency
fund.
7 For a description of SNAP, see CRS Report R42505, Supplemental Nutrition Assistance Program (SNAP): A Primer
on Eligibility and Benefits.
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Amount of Contingency Funds
The annual cap on contingency funds is limited to 20% of a state’s basic block grant. The actual
amount of contingency funds a state is entitled to for the year depends on (1) how much it spends
in advance contingency funds and state funds in excess of the contingency fund state spending
requirement, (2) its Medicaid matching rate, and (3) the number of months the state was eligible
for contingency funds. For the purposes of determining the annual contingency fund entitlement,
expenditures on child care do not count.
Given the annual limit on appropriations in recent years, the number of months contingency funds
are paid is based on the number of states that seek to draw funds and the total appropriation to the
fund. The $608 million appropriated in recent years has not been sufficient to pay contingency
funds for the states that received these grants for all 12 months in a year.
Pandemic Emergency Assistance Fund
The American Rescue Plan Act of 2021 (P.L. 117-2) established within TANF a temporary $1
billion fund to help offset the economic impact of the COVID-19 pandemic. Allocations were
made to states, tribes, and territories (including American Samoa and the Commonwealth of the
Northern Mariana Islands) according to a statutory formula8 to help them finance short-term,
nonrecurrent benefits. No additional spending for states or other grantees is required to receive
pandemic funds. Table 3 shows the initial allocations to the states under the Pandemic
Emergency Assistance Fund.
Table 3. Allocations Under the TANF Pandemic Emergency Assistance Fund
Allocation
Percentage
State
(in millions)
of Total
Alabama
$10.182
1.0%
Alaska
3.364
0.3
Arizona
14.546
1.5
Arkansas
4.715
0.5
California
203.819
20.4
Colorado
13.503
1.4
Connecticut
7.097
0.7
Delaware
2.076
0.2
District of Columbia
14.740
1.5
Florida
35.508
3.6
Georgia
22.014
2.2
Hawaii
4.217
0.4
Idaho
3.423
0.3

8 The law provides that $2 million is set aside for federal administration, and of the remaining funds, 92.5% is allocated
by formula to the 50 states and District of Columbia and 7.5% is set aside for the tribes and territories. After these set-
asides, funds are allocated among the 50 states and the District of Columbia based on two formula factors with equal
weights: (1) each jurisdiction’s share of the child (under age 18) population and (2) each jurisdiction’s share of total
FY2019 TANF expenditures on basic assistance, nonrecurrent short-term benefits, and emergency assistance.

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Allocation
Percentage
State
(in millions)
of Total
Il inois
20.440
2.0
Indiana
10.709
1.1
Iowa
6.334
0.6
Kansas
5.142
0.5
Kentucky
17.411
1.7
Louisiana
7.906
0.8
Maine
3.851
0.4
Maryland
17.756
1.8
Massachusetts
27.853
2.8
Michigan
19.002
1.9
Minnesota
14.352
1.4
Mississippi
4.751
0.5
Missouri
14.531
1.5
Montana
2.734
0.3
Nebraska
4.439
0.4
Nevada
6.794
0.7
New Hampshire
4.145
0.4
New Jersey
17.254
1.7
New Mexico
6.385
0.6
New York
128.476
12.8
North Carolina
16.783
1.7
North Dakota
1.355
0.1
Ohio
33.946
3.4
Oklahoma
7.124
0.7
Oregon
12.226
1.2
Pennsylvania
26.444
2.6
Rhode Island
2.703
0.3
South Carolina
10.153
1.0
South Dakota
2.286
0.2
Tennessee
12.995
1.3
Texas
49.519
5.0
Utah
7.335
0.7
Vermont
1.617
0.2
Virginia
15.745
1.6
Washington
22.766
2.3
West Virginia
4.618
0.5
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Allocation
Percentage
State
(in millions)
of Total
Wisconsin
14.523
1.5
Wyoming
1.545
0.2
Total, 50 states and District of Columbia
923.150
92.3
Puerto Rico
18.451
1.8
Guam
0.893
0.1
U.S. Virgin Islands
0.734
0.1
American Samoa
0.495
0.0
Northern Mariana Islands
0.486
0.0
Total, territories
21.059
2.1
Total, tribes
53.791
5.4
Technical assistance
2.000
0.2
Total
1,000.000
100.0
Source: Congressional Research Service (CRS), based on data in U.S. Department of Health and Human
Services (HHS), Administration for Children and Families, U.S. Office of Family Assistance, The Pandemic
Emergency Assistance Fund, TANF-ACF-PI-2021-02, April 9, 2021.
Nonrecurrent short-term benefits are defined as economic aid provided to families to help them
address a specific episode of need, one not expected to exceed four months. Grantees may use up
to 15% of their grant for the administrative expenses of providing these benefits.
Jurisdictions had until September 30, 2022, to expend their initial grant awards. Funds unused as
of that date were reallocated among grantees that used their full initial grants and also applied for
those additional funds.9
Additional TANF Funding in the Past
The Pandemic Emergency Assistance Fund was preceded by other additional TANF grants that were targeted
toward meeting special needs. In 2009, a $5 bil ion Emergency Contingency Fund was enacted to provide
additional funding in response to the recession fol owing the global financial crisis (see CRS Report R41078, The
TANF Emergency Contingency Fund). Congress also responded to the economic dislocations along the Gulf Coast
caused by Hurricanes Katrina and Rita by converting loans into grants and providing special access to the TANF
contingency fund (see CRS Report RS22246, Temporary Assistance for Needy Families (TANF): Its Role in Response to
the Effects of Hurricane Katrina).
Use of Federal TANF Grants and the Rules for
Counting State MOE Expenditures
TANF is not a program per se; rather, it is a set of funding streams used at the state and local
levels to provide a wide range of benefits, services, and activities with the general aim of
ameliorating the effects, or address the root causes, of childhood economic disadvantage. Both

9 U.S. Department of Health and Human Services, Administration for Children and Families, Office of Family
Assistance, The Pandemic Emergency Assistance Fund, TANF-ACF-PI-2021-01, April 9, 2021,
https://www.acf.hhs.gov/ofa/policy-guidance/tanf-acf-pi-2021-02. As of August 2023, HHS has not released the total
amount of pandemic fund dollars that were unused or how those funds were reallocated.
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TANF and state MOE expenditures can finance many of the same activities for the same
populations. However, the rules for how states may use TANF funds do differ in some aspects
from the rules that govern whether or not states may count expenditures toward meeting the
TANF MOE requirement.
Using Federal TANF Grants
Federal TANF grants may be used for a wide range of benefits and services for families with
children. Grants may be used within state or tribal TANF-funded programs, or a portion may be
transferred to either the Child Care and Development Block Grant (CCDBG) or the Social
Services Block Grant (SSBG). Unused TANF funds can also be reserved (i.e., saved), without
fiscal year limit.10
Achieving TANF Goals
TANF allows its basic block grant and contingency funds to be spent “in any manner that is
reasonably calculated” to achieve its statutory purpose.11 TANF’s purpose is to increase state
flexibility to meet four statutory goals:12
1. provide assistance to needy families so that children can be cared for in their own
homes or in the homes of relatives;
2. end dependence of needy parents on government benefits through work, job
preparation, and marriage;
3. reduce the incidence of out-of-wedlock pregnancies; and
4. promote the formation and maintenance of two-parent families.
The authority to spend TANF grants to achieve its statutory purpose includes traditional cash
assistance, but it also gives states the authority to spend TANF dollars on a broader set of
activities available to a wider population than targeted cash assistance programs. TANF funds are
used to help support work for low-income families through providing child care, transportation
aid, and state versions of the Earned Income Tax Credit (EITC). The authority to provide
assistance to care for children in the homes of relatives has been used to provide benefits and
services to children, and families of children, who have been, or are at risk of, neglect or abuse
and are placed in the care of a relative (e.g., grandparent, aunt, uncle).
Need-Tested and Not Need-Tested Use of Funds
TANF is usually associated with needy families, and some uses of it require that a family meet a
test of financial need, but other uses do not. Spending to meet the first two statutory goals,
providing assistance to needy parents and ending dependence of needy parents on government
benefits, must be spent on those in financial need. On the other hand, federal TANF funds used on
benefits, services, and activities that aim to reduce the incidence of out-of-wedlock pregnancies
and promote the formation and maintenance of two-parent families need not be restricted to those
in immediate need. The wording in the statute does not reference financial need for these two

10 Before the enactment of the American Recovery and Reinvestment Act of 2009 (ARRA, P.L. 111-5), reserved funds
could only be used for the purpose of providing “assistance.” The ARRA eliminated this restriction to the use of
reserve funds, so that reserve funds can be used to provide any allowed TANF benefit or service.
11 Section 404(a)(1) of the Social Security Act.
12 The TANF purpose statement is in Section 401(a) of the Social Security Act.
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goals. Activities related to these goals can be seen as seeking to prevent financial need, and hence
are available to the general population in a state.
Grandfathered Activities
In addition to using funds to promote the purpose and goals of TANF, federal law allows states to
use TANF funds to carry out any program or activity that a state had conducted under its pre-1996
programs. This provision permits states to continue activities they undertook under the pre-TANF
EA program to provide help for foster care, adoption assistance,13 and juvenile justice programs.
Transfers to Other Block Grants
Federal law allows up to 30% of the SFAG to be transferred to the CCDBG and SSBG combined,
with a separate limit of 10% of the SFAG that may be transferred to SSBG.14 Funds transferred to
these other block grants become subject to the rules of the receiving block grant and are not
subject to TANF rules. However, TANF funds transferred to SSBG must be used for families with
incomes below 200% of the poverty line. Funds from the TANF Contingency Fund or the
Pandemic Emergency Assistance Fund may not be transferred.
Matching for Transportation Grants
The Transportation Equity Act for the 21st Century (P.L. 105-178,) established Job Access and
Reverse Commuter Grants. These grants funded programs to provide transportation assistance for
those who need to commute from inner city to suburban areas for their jobs. These programs were
targeted to TANF assistance recipients and other low-income individuals. Federal law allowed
federal TANF funds to be used as a state match for reverse commuter grants.
The Job Access and Reverse Commuter Grants have been repealed. However, the Department of
Transportation’s urbanized area formula grants and formula grants for rural areas can be used for
activities previously funded by them.15 Through FY2021, states have continued to report some
expenditures on job access and reverse commuter grants.16 If federal TANF funds are used for this
purpose, it is counted against the state’s 30% limit for transfers to CCDBG and SSBG; that is, it
reduces the amount of federal TANF funds that could be transferred to those other block grants.
Prohibited Use of TANF Funds
Though states have broad authority to spend TANF funds, federal law prohibits them from using
the funds in certain ways. Most TANF prohibitions are rules that disallow using federal TANF
funds to provide assistance to certain populations (see the “Federal Eligibility Rules for
Assistance” section). One prohibition applies more broadly: states cannot use federal TANF funds

13 These are foster care and adoption assistance cases that are ineligible for other federal financing from programs
under Title IV-E of the Social Security Act.
14 PRWORA (P.L. 104-193), as modified by technical corrections in the Balanced Budget Act of 1997 (P.L. 105-33),
set the limit on transfers from TANF to SSBG at 10% of the TANF block grant. The Transportation Equity Act for the
21st Century (P.L. 105-178) reduced funding for SSBG and the transfer authority from TANF to SSBG to 4.25%,
effective FY2001. However, annual appropriation bills and temporary extension legislation (that continued TANF on
the terms of previous years) have provided for a 10% transfer limit for FY2001 and each subsequent fiscal year.
15 See discussion on the U.S. Department of Transportation, Federal Transit Administration, website at
https://www.transit.dot.gov/funding/grants/grant-programs/job-access-and-reverse-commute-program-5316.
16 See the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Family
Assistance website (Appendix F): https://www.acf.hhs.gov/sites/default/files/documents/ofa/
fy2020_tanf_financial_data_table_092221.pdf.
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to provide medical services, though the funds can be used for pre-pregnancy family planning
services.
TANF law penalizes states for misuse of TANF grants. Misuse of funds is determined through an
audit conducted under the Single Audit Act. The penalty for misuse of funds equals the amount of
TANF funding the audit determined was misused.
Using Federal Funds to Finance Pre-existing State Spending
TANF gives states the authority to spend federal funds to achieve TANF’s statutory purpose,
which is a broader set of activities available to a wider population than was targeted in the
repealed cash assistance and associated programs. It includes the authority to spend TANF funds
on activities that historically had been funded by states and localities themselves, rather than with
federal funds. TANF did not include a requirement that federal funds be used to supplement
rather than supplant existing spending. That is, it is legal for states to use federal TANF funds to
finance activities that previously had been state and local responsibilities.17
Counting Expenditures Toward the MOE Requirement
In some respects, there is more flexibility in the expenditures a state may count toward the MOE
than in the use of federal TANF grants, though there are a few cases where states have more
flexibility in their use of federal TANF grants than in the expenditures that can be counted toward
the MOE.
General Rules for Counting State Spending
States may count qualified expenditures toward the MOE. The main criteria for qualified
expenditures is that they be for the following:
• Eligible families, which are defined as families that include a child and meet a
test of low income. There is an exception to the requirement that the expenditure
be for eligible families if it is for an activity related to either responsible
fatherhood or healthy marriage.
• TANF-related activities, such as cash assistance, administration, child care,
education and training (though not educational activities for the general
population), and other activities that are reasonably calculated to further a TANF
statutory goal.
The expenditure of funds in a state’s localities can count toward the MOE as long as they meet
the requirements of a qualified expenditure. Under certain circumstances, a state may count as
MOE expenditures donations from nongovernmental third parties such as nonprofit
organizations.18 This includes the value of in-kind contributions, such as volunteers’ time. These

17 The Government Accountability Office (GAO) examined the degree to which TANF was used to supplant state
funding in the early years of the block grant. GAO examined state budgets and found that “supplanting was a common
budget practice.” The degree of supplanting state funds with TANF funds varied across examined states. Moreover, the
reasons—to provide fiscal relief or to more flexibly address the needs of low-income children—also varied. The study
also found that overall, when looking broadly, states increased total funding for programs addressing TANF’s focus on
disadvantaged children, particularly in health care and child welfare services. See GAO, Welfare Reform: Challenges in
Maintaining a Federal-State Fiscal Partnership, GAO-01-828, August 2001, p. 12.
18 This is not a statutory or regulatory rule specific to TANF. Under the so-called common-rule for federal grant
programs, a cost-sharing requirement may be met in whole or in part by third-party contributions. HHS has determined
(continued...)
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third-party contributions must be providing benefits, services, or activities that usually count
toward the MOE and also must benefit eligible families.
In general, state dollars that are used to meet a cost sharing requirement or a matching
requirement for other programs—such as Medicaid—cannot be counted as a MOE expenditure.
However, there are special rules for child care expenditures because of interactions between the
TANF MOE and various state spending requirements related to the Child Care and Development
Fund (CCDF).19
Counting MOE Expenditures vs. Use of Federal TANF Funds
Most, but not all, benefits, services, and activities that may be funded from federal TANF funds
may also be financed by MOE funds. States have additional flexibility in the populations that may
be provided assistance with MOE funds. In addition to assisting families eligible for federally
funded benefits, services, and activities, states may use MOE dollars to assist two additional
groups:
• families that have exceeded TANF’s five-year time limit; and
• noncitizens who were made ineligible for federally funded benefits in
PRWORA.20
Conversely, some benefits, services, and activities that can be financed by federal funds cannot be
financed by MOE funding. The major restrictions that apply to MOE (but not federal TANF)
funds are as follows:
• There is a new spending test for certain expenditures. The new spending test
applies to expenditures for benefits, services, and activities that were not
authorized under TANF’s predecessor programs (AFDC, EA, JOBS, and AFDC-
related child care). If a current state or local program operated in FY1995 for
activities that meet the definition of qualified expenditures but were not
authorized under TANF’s predecessor programs, then the state may only count
expenditures for that program that exceed the FY1995 level. Expenditures for
activities authorized under the predecessor programs can be counted without
regard to the new spending test.
• Expenditures on grandfathered activities are not countable. Expenditures on
activities that were part of the pre-1996 programs that are not aimed to achieve a

that the TANF MOE is a cost-sharing rule; hence, third party contributions may count toward meeting that requirement.
See U.S. Department of Health and Human Services, Administration for Children and Families, Office of Family
Assistance, Clarification that third party cash or in-kind may count toward a State’s or Territory’s maintenance-of-
effort (MOE), TANF-ACF-PA-2004-01, https://www.acf.hhs.gov/ofa/policy-guidance/tanf-acf-pa-2004-01-
clarification-third-party-cash-or-kind-may-count-toward.
19 Funding for the CCDF is fairly complex, with a series of federal and state funding streams that finance subsidized
child care for low-income families (see CRS In Focus IF10511, Child Care Entitlement to States: An Overview). One
of the funding streams is the CCDF matching grant that requires child care expenditures to meet a MOE requirement
(i.e., be at least what they were in FY1994 or FY1995, whichever is higher) and then additional state expenditures to
match federal funds up to a maximum. States may count for the purpose of the TANF MOE state child care
expenditures up to the MOE threshold (i.e., the amount of expenditures made in FY1994 or FY1995) and state child
care expenditures made in excess of state expenditures needed to draw the maximum federal match for CCDF matching
grants.
20 For more information, see CRS Report RL33809, Noncitizen Eligibility for Federal Public Assistance: Policy
Overview.
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TANF goal—grandfathered as an allowable use of TANF grants—are not
countable toward the MOE.
• Expenditures on activities to address TANF goals of reducing out-of-
wedlock pregnancies and promoting two-parent families must be need-tested
and for eligible families, except if they are for responsible fatherhood or
healthy marriage activities. Federal TANF funds spent on activities that seek to
achieve the goals of reducing out-of-wedlock pregnancies and promoting two-
parent families can be available for the general population, not just for families
meeting a test of financial need. HHS regulations limit the counting of non-need-
tested activities toward the MOE requirement to activities that are described in
statute as being for responsible fatherhood and healthy marriage activities.21
Counting MOE Expenditures: Either Comingled with Federal Funds or
Separate from Federal Funds
A state’s MOE expenditures can be combined (i.e., comingled) with federal funds to finance
benefits, services, or activities. For example, a state may choose to have one assistance program
(monthly benefit checks) and use both federal and MOE dollars to finance it. Conversely, a state’s
MOE expenditures can be expended separately from federal dollars in either a separate program
or accounted for separately.
In the case of MOE expenditures comingled with federal dollars, the requirements and
prohibitions that apply to federal dollars apply to those state MOE expenditures as well. In the
case where a benefit, service, or activity is separated from federal dollars, the requirements and
prohibitions that apply to it depend on whether the state chooses to count that MOE expenditure
in TANF or in an SSP.
Counting MOE Expenditures: In TANF or In Separate State Programs
To meet the MOE requirements, the TANF statute allows states to count spending in any program
that meets the general rules as qualified expenditures. Thus, the MOE expenditures may be
counted in TANF or in an SSP. There are two main implications for counting expenditures in
TANF or in an SSP:
• for assistance, some rules do not apply in an SSP that apply if that MOE
spending is counted in TANF; and
• dollars spent in SSPs do not count toward the TANF contingency fund state
spending requirement.
Summing Up the Rules: Financing a Benefit, Service, or Activity
The different rules for using federal grants and counting TANF MOE expenditures provide both
complication and flexibility when a state decides how to finance a TANF benefit or service.
• Federal funds can be either transferred to the other block grants or spent within
TANF.

21 The Deficit Reduction Act of 2005 (P.L. 109-171) amended TANF law to provide that states could count
expenditures related to reducing out-of-wedlock pregnancies and promoting two-parent families toward the MOE
requirement. HHS interpreted that provision so that these expenditures would still be required to be spent on behalf of
eligible families unless they were spent on activities related to responsible fatherhood and healthy marriage enumerated
in Section 403(a)(2) of the Social Security Act.
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• Federal TANF grants and state MOE dollars can be comingled or accounted for
separately. If dollars are comingled, in general, the rules that apply to both
federal TANF dollars and state MOE dollars apply to the comingled state dollars.
For federal grant dollars accounted for separately, only federal rules apply. For
state MOE dollars accounted for separately, only rules for counting expenditures
toward the MOE requirement apply.
• State MOE dollars accounted for separately from federal TANF dollars can either
be counted in TANF or in SSPs.
Figure 1 summarizes some of the choices states have in using the federal funding stream or MOE
expenditure funding streams to finance a TANF benefit, service, or activity. Depending on these
choices, different rules apply. Though the rules are complex, they do give states flexibility. Note
that these are only the general rules regarding funding streams—there is an additional layer of
complexity for expenditures on assistance. Further detail on how federal dollars and state dollars
are classified when providing assistance to families is shown in Table 4.
Figure 1. Summary of Rules Associated with Using TANF Funds and
Counting MOE Funds

Source: Congressional Research Service (CRS).
Note: Carried over (from previous fiscal year) federal TANF grants cannot be transferred to the Child Care
Development Block Grant or Social Services Block Grant.
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Enforcing Prohibitions and Requirements
The prohibitions and requirements for using TANF and counting MOE funds are generally
enforced through penalties. These penalties put a state at risk of receiving a reduced block grant,
with the maximum penalty generally specified in statute. Many penalties are expressed as a
percentage of the state’s block grant, with the calculation specified in regulation as a percentage
of the state’s adjusted SFAG. The adjusted SFAG is the state’s basic block grant allocation minus
payments to tribes and transfers to CCDBG and SSBG.
By statute, a state’s block grant amount cannot be reduced by more than 25% of its adjusted
SFAG. If the total penalties exceed the 25% cap, the excess penalties must be paid out of
subsequent years’ grants. If a state’s block grant is reduced by a penalty, it is required to replace
the penalized federal funds with state dollars.
Many penalties on the state can be waived if the state can establish reasonable cause for not
complying with a prohibition or requirement. States can also avoid many of these penalties by
entering into a corrective compliance plan and subsequently come into compliance with the law.
The penalties that are not subject to reasonable cause and corrective compliance are those that
relate to funding. For a detailed list of TANF penalties, see Appendix B.
Limits on Federal Regulation
Federal law limits the ability of HHS to regulate the conduct of states with respect to TANF:
No officer or employee of the Federal Government may regulate the conduct of States
under this part or enforce any provision of this part [Part A, Title IV of the Social Security
Act, or TANF] except to the extent expressly provided in this part [TANF].22
HHS, in promulgating regulations, interpreted the statute as allowing regulation (1) where
Congress explicitly directed HHS to issue regulations and (2) where HHS was charged with
enforcing penalties.23 As noted above, many of the penalties relate to policies around providing
assistance to families.
HHS has noted that some cross-cutting laws do apply to TANF and MOE activities regardless of
this limitation of regulation. For example, civil rights laws, the Fair Labor Standards Act, and the
Cash Management Improvement Act (CMIA) apply to TANF.
TANF’s Definition of Family
The concept of family naturally is central to a block grant called Temporary Assistance for Needy Families. Yet the
term family—like many terms used in TANF—is left undefined in statute. While HHS defined some terms in
regulation, it explicitly gave states the freedom to come up with their own definition of family. For example, states
have the flexibility whether to include noncustodial parents in a family. Note that specific definitions of family are
used for specific purpose (e.g., the requirement that TANF MOE funds be spent on eligible families and what
constitutes a two-parent family for the purpose of the TANF work standards). However, for general purposes, the
definition of family is left to the states.
In promulgating regulations, HHS said it defined only specific terms because “excessive definition of terms could
unduly and unintentionally limit State flexibility in designing programs that best serve their needs” (see U.S.
Department of Health and Human Services, "Temporary Assistance for Needy Families Program," 62 Federal
Register 62131, November 20, 1997).

22 Section 417 of the Social Security Act.
23 U.S. Department of Health and Human Services, “Temporary Assistance for Needy Families Program (TANF); Final
Rule,” 64 Federal Register 17725, April 12, 1999.
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TANF Requirements for States When Funds Are
Used to Provide Assistance
The TANF statute applies most of its specific requirements to funds that are used to provide
assistance to needy families with children. Assistance provided to families triggers TANF’s work
requirements, time limits, child support requirements, and most of its data reporting requirements.
Yet the TANF statute itself does not define the term assistance. Given the central role that
assistance plays in TANF’s policies, HHS did define the term in regulation.
Definition of Assistance
HHS, in regulation, defined assistance as follows:
The term “assistance” includes cash, payments, vouchers, and other forms of benefits
designed to meet a family's ongoing basic needs (i.e., for food, clothing, shelter, utilities,
household goods, personal care items, and general incidental expenses).24
A benefit that meets the above definition that is paid in cash or a voucher is considered assistance.
Additionally, a benefit that meets the above definition that is paid either directly to the family or
to a third party on behalf of that family is considered assistance. Child care assistance and
transportation for nonworking parents is also considered assistance.
The definition of assistance encompasses the traditional cash assistance as was paid under AFDC.
However, it also includes benefits that go beyond traditional cash assistance. For example, states
have used MOE funds to provide SNAP benefits to noncitizens made ineligible by PRWORA as
allowed by law. Such benefits are considered assistance.
States have also created work supplement benefits. These are sometimes comparatively small
benefits (e.g., $10) paid as nutrition assistance for parents who receive SNAP, have earnings, and
meet TANF rules for being engaged in work. Such benefits are also considered assistance.
Funding these benefits from TANF as assistance helps some states meet their work participation
standards. However, beginning in FY2026 such work supplement benefits funded in SSPs must
equal or exceed $35 for the family’s participation to count toward the work standards.25 (For the
rules regarding being engaged in work, see a summary in the “Work Participation Standards”
section or more detail in Appendix A.)
What is Not Considered Assistance?
The regulation also lists benefits and activities that are not considered assistance. Explicitly
excluded from the definition of assistance are nonrecurrent short-term aid for an episode of need
expected to last four months or less; employment subsidies; child care and transportation for a
working parent; refundable earned income tax credits; contributions to Individual Development
Accounts; and counseling, case management, peer support and similar services.
States may explicitly design a TANF benefit in a way that does not meet the definition of
assistance and hence does not trigger the TANF work requirements, time limits, child support
enforcement requirements, and most reporting requirements. For example, a state may use TANF
funds to provide temporary help in paying rent for a family that is homeless or at risk of

24 45 C.F.R. §260.31(a)(1).
25 Amendment to TANF made by the Fiscal Responsibility Act of 2023 (P.L. 118-5).
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homelessness.26 If the state limits that type of help to four months or less, the benefit would be
considered a nonrecurrent short-term benefit and hence not be considered assistance and not
trigger TANF requirements.
A wide range of other TANF- and MOE-funded activities that do not provide ongoing economic
support are also considered not to be assistance. This includes employment services, services for
families where children are at risk of abuse and neglect, funding for activities for youth, and most
activities to promote responsible fatherhood and healthy marriage. These activities are also not
subject to the rules triggered when a family is provided assistance.
TANF Expenditures on Assistance and Other Benefits and Services: FY2021
Though most TANF policy relates to when funds are spent on assistance for families with children, that assistance
accounts for only a fraction of how federal TANF and state MOE dol ars are spent. Among all categories of
spending, basic assistance (the category that most closely corresponds to spending on cash assistance programs)
was the largest category. However, the $6.9 bil ion in federal and MOE funds spent on basic assistance accounted
for about 22.6% of the total $30.3 bil ion in total expenditures. TANF funded a wide range of benefits, services,
and activities other than assistance—child care subsidies; work, education, and training (for both recipients of
assistance and others); child welfare related to children at risk of, or who have been victims of, abuse and neglect;
and emergency and short-term benefits. In general, the TANF rules that apply when funds are used for assistance
do not apply when funds are used for these other activities.

Source: Congressional Research Service (CRS), based on data from the Office of Family Assistance, U.S.
Department of Health and Human Services.
Federal Eligibility Rules for Assistance
TANF requires that a family have a child or a pregnant individual to be eligible for assistance,
and federal TANF funds cannot be used unless the family includes such individuals. The law
defines minor child as a person under age 18 or age 18 and still in school. TANF MOE funds may
be used to assist families with a pregnant individual or who have a child living with a custodial
parent or other caretaker. In defining child for the purpose of MOE expenditures, a state may use

26 Lauren Dunton and Cara Sierks, Approaches to Assisting Families Experiencing or At Risk of Homelessness with
TANF Funds, U.S. Department of Health and Human Services, Administration for Children and Families, Office of
Planning, Research, and Evaluation, OPRE Report 2021-192, https://www.acf.hhs.gov/sites/default/files/documents/
opre/tanf-assisting-families-experiencing-homelessness-oct-2021.pdf.
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the federal definition of minor child or use another definition under state law.27 A state must also
impose a financial need test for assistance, and require that family income be below a specified
level, though the level is determined by the state.
Federal law also prohibits states from using federal TANF funds to provide assistance to the
following persons and families:
• families with an adult or minor child head of household who has received
federally funded aid for 60 months (see the “The TANF Time Limit” section);
• unwed teen parents, unless living in an adult-supervised setting;
• teens who have not completed high school, unless they are making satisfactory
progress toward achieving a high school or equivalent credential or in an
alternative training program;
• noncitizens who arrived in the United States after August 22, 1996, for the first
five years after arrival28; and
• fugitive felons and parole violators.
States may use MOE funds to assist these families and individuals. Additionally, PRWORA
provides that persons convicted of a drug-related felony may be denied assistance under TANF,
unless the state affirmatively opts out of this provision.29
Aside from the requirement that TANF assistance be restricted to needy families with children
and the listed statutory prohibitions on the use of federal funds, states have broad leeway to set
eligibility rules for the assistance. States determine actual income eligibility standards (to
determine whether a family is needy) and can determine other conditions and criteria for
eligibility. States also determine benefit amounts paid to families.30
TANF Work Requirements
With respect to families receiving assistance, TANF requires states to meet work participation
standards; assess the employability of adult recipients and those under 18 who do not have a high
school diploma and are not in school, engage parents and caretakers in work or activities within
24 months, and sanction families with a member who refuses without good cause to engage in
work or activities. States have considerable latitude when implementing these requirements.
Work Participation Standards
The TANF work participation standards are numerical performance measures, computed in the
aggregate for each state, which require that a specified percentage of families receiving assistance

27 U.S. Department of Health and Human Services, “Temporary Assistance for Needy Families Program (TANF): Final
Rule,” 64 Federal Register 17817, April 12, 1999.
28 These prohibitions are generally found in Title IV of PRWORA.
29 This provision is not in TANF law, but is in Section 115 of PRWORA.
30 For detail on state rules, see Ilham Dehry, Sarah Knowles, and Katie Shantz et al., Welfare Rules Databook:State
TANF Policies as of July 2020, U.S. Department of Health and Human Services, Administration for Children and
Families, Office of Planning, Research, and Evaluation, OPRE Report 2021-147, January 2022, https://wrd.urban.org/
wrd/Data/databooks/2020%20Welfare%20Rules%20Databook%20(final%2002%2023%202022).pdf.
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with a work-eligible individual31 be considered engaged in specified activities for a minimum
number of hours.32 The participation standards encompass those families in TANF and SSPs.
Statute sets nominal standards that specify numerical targets of 50% of all families and 90% of
two-parent families be either working or engaged in specified activities for a specified minimum
hours of work per week. However, those targets are reduced by caseload reduction credits, where
a state gets a credit toward its work standard by reductions in the number of families receiving
assistance since FY2005. Caseload reductions caused by policy changes are not counted toward
this credit. In addition to receiving credit toward its work standard for fewer families receiving
assistance, under a regulatory provision a state can count as caseload reduction spending in
excess of that state’s MOE requirement.33
The Caseload Reduction Credit and Effective (After-Credit) Standards in FY2021
The caseload reduction credit reduced the 50% all family standard for all but six jurisdictions in FY2021. The
credits reduced that all family standard to 0% for 32 jurisdictions, effectively permitting them to have no families
engaged in work or activities but stil be in compliance with their work participation standard. The effective
standard was less than 25% in 47 states.
Understanding the effective standards for two-parent families is more complex. Only two states (Alabama and
Pennsylvania) had a caseload reduction credit of 90% that itself reduced the standard to 0%. However, 26
jurisdictions reported no two-parent families in TANF or SSP-MOE programs. Such states often aid families in
solely state funded (SSF) programs (discussed in the “Choice of Funding Stream and Rules for Assistance” section)
and effectively avoided the two-parent standard through that means.
Beginning with the work standard for FY2026, the caseload reduction credit will be based on
caseload change from FY2015, rather than FY2005.34
To determine whether a state meets the work participation standards, two work participation rates
(WPRs) are calculated: one for all families and another for two-parent families. The WPR for all
families is the fraction of families with work eligible individuals who meet the criteria of having
such individuals engaged in work. States that have a WPR at or above their effective (after-credit)
standard meet the standard. States with a WPR that falls short of the standard are considered not
to have met their minimum work rate and are at risk of being penalized. A separate WPR is
calculated for the fraction of two-parent families with work-eligible individuals who meet
engaged in work criteria.
The law specifies the activities that count toward being engaged in work, which include
unsubsidized employment (i.e., work in a regular job); subsidized employment (i.e., work in a job
subsidized by TANF or other governmental funds); work experience and community service
programs; and pre-employment activities such as job search and job readiness assistance,
vocational educational training, and other forms of education and training. There are time limits
for how long job search and readiness assistance and vocational educational training may be
counted toward the standard. There are also limits to the circumstances for which participation in
other educational activities is counted. Beginning in FY2026, states will no longer be able to
count activities of those in families that receive assistance funded through separate state programs
unless the assistance amount equals or exceeds $35 per month (See the “Choice of Funding
Stream and Rules for Assistance” section).

31 For the definition of who is a work-eligible individual, see Appendix A.
32 Section 407(a) of the Social Security Act.
33 45 C.F.R. §261.43(b).
34 This change was made by the Fiscal Responsibility Act of 2023 (P.L. 118-5). The law raised the federal debt limit
and made policy changes, including changes to TANF work standards.
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In addition, federal law sets minimum hours by family type. (Details of the TANF work
participation standards are provided in Appendix A). States are also required to have systems in
place to verify work participation of individual recipients.35
A state that does not meet both of its numerical performance standards is at risk of being
penalized by a reduction in its block grant. The penalty for not meeting the performance standards
can be waived for reasonable cause, and states can also avoid the penalty if they come into
compliance with the standard through a corrective compliance plan. However, a state that does
not meet one or both of the work standards is subject to a MOE nonfederal spending requirement
at 80% of the historical level of spending, rather than at 75% of the historical level of spending
(see the “Maintenance of Effort Requirement” section).
States have flexibility in how to meet the work participation standard. The work and participation
requirements that apply to individual recipients and families are determined by the states.
Employability Assessments
States are required to assess each recipient who is an adult (age 18 or older) or has not completed
high school and is not attending secondary school. The assessment is required to be made within
90 days of determination of the recipient’s eligibility for assistance.36 States have the option to
develop an Individual Responsibility Plan (IRP) setting forth employment goals for the
individual, the obligations of the individual, and the services the state will provide the individual
to be able to obtain and keep employment.
Engagement Within Two Years
States are required to engage each parent or caretaker adult in work, as defined by the state,
within 24 months. For this requirement, the state is free to determine what constitutes being
engaged in work.37
Sanctions for Refusing to Engage in Work or Activities
States are required to sanction a family with a member who refuses to comply with its work
requirements without good cause. States are free to determine the sanction amount, and whether
to reduce benefits or terminate benefits for families that fail to comply with work requirements
(i.e., a full-family sanction). States also determine what constitutes good cause for not complying
with work requirements. States are prohibited from sanctioning a family with a single parent with
a child under the age of six if he or she refuses to comply with work requirements because he or
she cannot find affordable child care.38
Non-displacement Requirement
An individual in a federally funded TANF work activity cannot displace a regular employee. That
is, a participant cannot be placed in federally funded work activity to fill a vacancy that exists
because (1) another person is on layoff from the same or equivalent job, (2) of an involuntary

35 Section 407(i) of the Social Security Act.
36 Section 408(b)(1) of the Social Security Act.
37 Section 402(a)(1)(A)(ii) of the Social Security Act. This requirement is a part of the TANF state plan, and there is no
specific penalty for a state that fails to engage a parent or caretaker in work by the 24-month deadline.
38 Section 407(e) of the Social Security Act.
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reduction in the employer’s workforce, or (3) of firing another employee for the purpose of filling
the vacancy with a TANF participant. States are required to maintain a grievance procedure for
resolving complaints of regular employees.
Employment Outcome Reporting and Pilots
The Fiscal Responsibility Act of 2023 (P.L. 118-5) requires states, beginning in FY2025, to col ect data to permit
the measurement of employment outcome data for those who leave TANF assistance. The employment outcomes
include the percentage who are employed in the second quarter after exiting assistance, those who are employed
in both the second and fourth quarter after exiting assistance (an employment retention measure), and the median
earnings of those who left employment and were employed in the second quarter after exiting assistance. An
additional outcome would be the percentage of individuals under age 24 who obtained a high school degree or
equivalent while receiving assistance.
Additionally, beginning in FY2025 HHS has the authority to permit up to five states to operate pilot projects to
test performance systems other than the WPR and measure work and family outcomes. HHS and the states in the
pilot are required to agree on performance benchmarks that would include employment rates, earnings, and other
indicators of family stability and well-being.
The TANF Time Limit
States may not use federal TANF funds to provide assistance to a family containing an adult or
minor child household head who has received five years (60 months) of federally funded
assistance.39 The federal five-year time limit is a prohibition on states’ use of federal TANF funds,
not a direct limitation on how long a particular family may receive assistance.
Federal law provides a hardship exception to the time limit, allowing federal funds to be used in
cases of hardship for up to 20% of the caseload beyond the five-year limit. Further, federal law
explicitly allows a state to use state MOE funds to aid a family beyond the time limit. States that
do not comply with the time limit (e.g., exceed the 20% cap) would be subject to a penalty of up
to 5% of their adjusted SFAG.40
States have flexibility in how they implement the time limit as it applies to individual recipients
and families. Many states have adopted the five-year limit as their own; others have shorter time
limits and, thus, in practice must track time as it accrues to both the federal and state time limits.
A few states effectively do not limit the amount of time a family may receive assistance, either
providing aid to families beyond five years using state funds (e.g., New York) or eliminating
assistance paid on behalf of the family’s adults after a time limit and continuing benefits
indefinitely only on behalf of the children (e.g., California).
Child Support Enforcement Requirements
In single-parent families receiving cash assistance, such as those headed by a single mother, there
may also be a noncustodial parent who is also likely to be financially responsible for the
children’s economic well-being. TANF has requirements that assistance recipients cooperate with
child support enforcement and assign their child support to the state as a condition of receiving
assistance within the TANF program. These requirements do not apply if assistance is provided
through an SSP (see the “Choice of Funding Stream and Rules for Assistance” section).

39 Section 408(a)(7) of the Social Security Act. Note that this prohibition on use of federal funds also would apply to
assistance paid using comingled state MOE funds.
40 Section 409(a)(9) of the Social Security Act.
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Families receiving TANF assistance must cooperate with the state in establishing the paternity of
a child and in establishing, modifying, or enforcing orders that the noncustodial parent pay child
support.41 Federal law requires states to penalize families who do not cooperate with child support
enforcement requirements by cutting their benefits at least 25%. States could penalize families by
more, and even end assistance for failure to cooperate with child support enforcement
requirements.
Families receiving TANF assistance must assign (i.e., legally turn over) any child support they
receive from noncustodial parents to their state as a reimbursement for assistance costs.42 The
federal government and the states split the receipts from assigned child support. A state has the
option of passing through assigned child support to TANF families. The federal government
shares in the cost of passing through child support paid to TANF families as long as the child
support is also disregarded in determining TANF eligibility and benefit amounts.43 State
expenditures from the pass through of child support, if disregarded in determining a family’s
assistance benefit, are countable toward the MOE requirement.
Special Provisions for Victims of Sexual Harassment and Domestic
Violence
Federal law requires states to certify that applicants and recipients of TANF assistance are
notified of help available to victims of sexual harassment and survivors of domestic violence,
sexual assault, and stalking. States must also certify that caseworkers and TANF administrators
are trained in understanding the nature of sexual harassment, domestic violence, and sexual
assault; state standards and procedures relating to the prevention of help for victims and
survivors; and methods for ascertaining and keeping confidential personal information and
documentation of those who have provided notice of their experiences with sexual harassment,
domestic violence, sexual assault, and stalking.
Federal law provides for an optional certification that a state has procedures in place to screen for
and identify victims of domestic violence, refer such victims to supportive services, and waive
certain program requirements.44 The program requirements that may be waived include work
requirements, the time limit, and cooperation with child support enforcement rules.
Though a state may waive certain program requirements for victims of domestic violence, federal
law does not exclude them from the TANF work participation rate standard calculation or the
20% limit on hardship cases that exceed the five-year time limit. However, HHS regulations
allow a state to provide victims of domestic violence with a federally recognized good cause
domestic violence waiver, and provide that a state would have reasonable cause for failing the
requirements if that failure was due to providing such waivers.45
A federally recognized domestic violence waiver must identify program requirements that are
being waived, be granted based on an individualized assessment, and be accompanied by a
services plan. These waivers must be reassessed at least every six months.

41 Section 408(a)(2) of the Social Security Act.
42 Section 408(a)(3) of the Social Security Act.
43 The amount of the pass-through that the federal government will share the cost of is limited to $100 for families with
one child and $200 for families with two or more children.
44 Section 402(a)(7) of the Social Security Act.
45 See regulations at 45 C.F.R. §§260.50-260.59.
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Restrictions on Cash Withdrawals at Certain Establishments
States generally pay assistance benefits by placing funds on Electronic Benefits Transaction
(EBT) cards to be used by recipients making withdrawals from Automated Teller Machines
(ATMs) or making purchases at point-of-sale terminals. Federal law requires states to maintain
policies and practices to prevent TANF assistance funds from being used in an EBT transaction in
liquor stores, casinos or gaming establishments, and strip clubs.46 States must prevent TANF cash
withdrawals at ATMs in such establishments, and prevent purchases using TANF assistance on
EBT cards at point-of-sale terminals in such establishments.
Additionally, TANF state plans are required to ensure that recipients (1) would have adequate
access to their benefits; (2) would have access to their benefits at minimal fees or charges,
including free access; and (3) are provided information on applicable fees and charges.
Choice of Funding Stream and Rules for Assistance
As discussed previously, a state may use federal TANF dollars or state MOE dollars in several
ways. With respect to assistance, this report discusses an additional option: using state funds on
TANF-related populations and not counting those funds toward the MOE requirement. These
types of expenditures are classified as Solely State Funded (SSF) programs. Families assisted in
SSFs are not subject to any of TANF’s requirements or prohibitions. The most common use of
SSFs is to provide assistance to two-parent families, and hence avoid the higher two-parent work
participation standard. Moreover, TANF funds can be used to indirectly finance SSFs.
How TANF Funds Can Indirectly Finance Solely State-Funded Programs
When a state decides to assist a family in an SSF—using only state dol ars—it nominally chooses to bear the cost
of that assistance within the state budget. However, TANF dol ars can indirectly finance SSF programs. One way is
that the state finds other expenditures in its budget that meet the broad definition of qualified expenditure
(including certain expenditures above the FY1995 spending level) and use those dol ars to meet the MOE
requirement, effectively replacing dol ars that otherwise would be counted by the SSF.
Federal TANF dol ars can be used on a wide range of benefits and services related to children—including benefits
and services that historically have been funded by states. While certain MOE dol ars are subject to a new spending
test (spending above FY1995 levels), this is not the case for federal TANF funds. TANF does not include a
requirement that federal funds cannot be used to finance existing state spending, so a state can legally use federal
TANF dol ars to reduce state costs, as long as those state costs reflect an activity that states may use TANF
grants to finance. That is, the cost of serving families in SSFs can be offset by having TANF funds pay for other
benefits and services that the state historically paid for by itself. Hence, TANF is indirectly funding that SSF
program.
Table 4 summarizes the application of TANF requirements for assistance recipients based on
whether a benefit was financed from federal funds, MOE funds, or SSFs.

46 Section 408(a)(12) of the Social Security Act.
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Table 4. Summary of TANF Requirements that Apply
to Recipients of Assistance, by Funding Source of the Benefit

State MOE Dollars

State MOE
Solely
Funds Not
State-
State
Comingled
Funded
Funds
with
Programs
Comingled
Federal
Separate
(SSFs)
Federal
with
Dollars but
State
Not
TANF Prohibition or
TANF
Federal
Expended
Programs
Counted
Requirement
Funds
Dollars
In TANF
(SSPs)
as MOE
Work participation standards
Yes
Yes
Yes
Yes, though
No
beginning in
FY2026
benefits must
equal or
exceed $35
per month
for work to
count
toward the
standards.
Time limit on assistance
Yes
Yes
No
No
No
Prohibition on providing assistance to
Yes
Yes
No (children
No (children
No
a family without a minor child (minor
must live with must live
child defined as under age 18 or age
a custodial
with a
18 and stil in school)
parent or
custodial
other
parent or
caretaker but
other
no explicit
caretaker but
age limit)
no explicit
age limit)
Requirement that families receiving
Yes
Yes
Yes
No
No
assistance assign their rights to child
support to the state and requirements
to penalize families that do not
cooperate with child support
requirements
Prohibition on providing assistance to
Yes
Yes
Yes
No
No
unwed teen parents, unless living in in
an adult-supervised setting
Prohibition on providing assistance to
Yes
Yes
No
No
No
teens (i.e., under age 20) who have
not completed high school, unless
they are making satisfactory progress
toward achieving a high school or
equivalent credential or in an
alternative training program
Prohibition on providing assistance to
Yes
Yes
No
No
No
fugitive felons and parole violators
Source: Table prepared by the Congressional Research Service (CRS).
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Tribal TANF
Federally recognized Indian tribes and certain Alaskan Native organizations have the option to
operate their own TANF programs for needy families with children.47 Tribes are entitled to
receive a grant equal to the amount of FY1994 federal expenditures in pre-TANF programs
attributable to Indian families residing in the area to be served by the tribal program. This is
financed by a reduction in the state’s block grant amount. States may, but are not required to,
provide tribes with MOE funds.
Tribes seeking to operate TANF programs must submit plans to the HHS Secretary for approval.
The HHS Secretary, with the participation of the tribes, establishes work requirements and time
limits for each tribe operating its own TANF program.
Additionally, tribes that operated pre-TANF work and education programs are provided grants to
operate tribal work programs that total $7.6 million per year. The amount of each grant equals
what the tribe received in FY1994 under pre-TANF programs.
TANF State Plans
States are required to submit state plans every three years as a condition of receiving TANF block
grant funds.48 The bulk of these plans is an outline of the program the state intends to operate. The
HHS Secretary cannot disapprove a state plan based on its content. Rather, the role of the
Secretary is to determine whether the state has included information on all required elements of
the plan. State plans have no set format, and vary greatly in their content and detail.
States may submit their TANF state plan either separately or as part of a combined state plan
under the Workforce Innovation and Opportunity Act (WIOA). WIOA is a federal grant program
to state and localities for workforce services. The WIOA state plan is intended to outline a state’s
four-year strategy for workforce development. Submission of the TANF plan as part of the WIOA
combined plan does not alter the statutory requirements for the TANF state plan, and HHS must
still determine that the TANF portion of the plan is complete for the state to receive TANF grants.
Data Reporting
TANF law and regulations require states to provide information on families receiving
assistance.49 States must provide both caseload counts and family- and recipient-level information
on families receiving assistance. The family- and individual-level information that states must
report includes basic demographic information, the work activities hours of adults, and the
financial circumstances of families and individual recipients receiving assistance. Neither
caseload counts nor characteristic information is required to be reported for families receiving
TANF-funded benefits and services that are not considered assistance.

47 Section 412 of the Social Security Act.
48 Section 402 of the Social Security Act.
49 Section 411 of the Social Security Act.
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Appendix A. The TANF Work Participation
Standard
This appendix describes the detailed rules of the TANF work participation standard.
TANF Work Participation: Glossary of Terms
The language of TANF work requirements and the work participation standard has its own nomenclature. The
fol owing are some of the key terms used in discussions of TANF work participation.
•
Work-eligible individual: generally a parent (either a recipient or nonrecipient) of recipient children and
nonparent caretakers of recipient children who themselves are recipients of TANF. Certain parents
(discussed in detail below) are excluded from the definition of work-eligible individual. Nonrecipient,
nonparent caretakers are not considered work-eligible individuals.
•
TANF work participation standard: the official assessment of state work programs under TANF. It
comprises (1) a statutory target rate of work participation, (2) the caseload reduction credit that reduces the
statutory target rate to an effective target rate, (3) a list of activities countable in the work participation rate,
and (4) the average minimum number of hours per week of participation required in a month for counting
activities toward the work participation rate.
•
Caseload reduction credit: a reduction in the target rate of work participation granted for reducing the
number of families receiving assistance since FY2005 (beginning in FY2026, the base year from which caseload
decline is measured changes to FY2015), not counting caseload reduction due to federal or state eligibility
changes since that year. States can also count as caseload reduction families aided by state spending in excess
of the MOE requirement.
•
Countable activities: a list of 12 activities (listed in law, defined in HHS regulations) that a work-eligible
individual may engage in to have her or his participation counted toward the TANF work participation
standard. Some activities are subject to certain limits in terms of how long and under what circumstances
they may be counted.
•
Engaged in work: a family with work-eligible individuals participating in countable activities for at least the
minimum number of hours.
•
Family included in the TANF work participation rate: a family with at least one work-eligible
individual who is not disregarded from the participation rate. The statute provides that certain families with a
work-eligible individual are or may be disregarded.
•
Work participation rate (WPR): a fraction (expressed as a percentage) derived by dividing the number
of families considered engaged in work by the number of families included in the participation rate. It is the
work participation rate that is compared to the target rate of work participation that determines whether a
state has met the TANF work participation standard.
The Numerical Participation Standard
TANF sets a minimum work participation standard that a state must meet or risk being penalized
through a reduction in its block grant. The standard is two performance measures (minimum
Work Participation Rates [WPRs] for all families and two-parent families) that apply in the
aggregate for each state.
The TANF statute stipulates that 50% of all families and 90% of two-parent families included in
the WPR calculation must be engaged in work to meet the standard. Included in the calculation
are families with a work-eligible individual (in the case of a two-parent family, families with two
work-eligible individuals) minus families disregarded from the calculation by statute (discussed
later in this Appendix). The WPR itself is calculated as the percentage of such families engaged in
work. This percentage is determined each month, and the WPR for a fiscal year is the simple
average of the WPR in each month.
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However, few states have ever had to meet the full standard because the percentages are reduced
for caseload reduction or state spending in excess of what is required under the TANF MOE. The
caseload reduction credit lowers a state’s 50% and 90% standards based on caseload reduction
measured from FY2005, not counting caseload reduction due to federal or state eligibility
changes since that year. Beginning with the work standard for FY2026, the caseload reduction
credit will be based on caseload change from FY2015, rather than FY2005.
Additionally, under HHS regulations promulgated in 1999, states may also receive credits for
spending in excess of what they are required to spend under the MOE requirement.50 States may
consider families assisted by spending in excess of MOE as caseload reduction, and hence receive
extra caseload reduction credits for such families. Regulations promulgated in 2008 established a
formula for determining this excess MOE portion of the caseload reduction credit; before those
regulations, states had used different methods.51
The caseload reduction credit reduces a state’s work participation standards by one percentage
point for each percentage point in the credit. For example, if a state has a caseload reduction
credit (including the effect of caseload reduction from excess MOE) of 25%, the state’s work
participation standard for the all-family standard is reduced by 25 percentage points—from 50%
to 25%. If a state has a caseload reduction credit of 50%, its all-family standard is reduced by 50
percentage points—from 50% to 0%. A similar calculation applies for the two-parent standard. In
determining the effective (after-credit) two-parent standard, the state has a choice of using the
two-parent caseload reduction calculation or the calculation used for the all-family standard.
Definition of Work-Eligible Individual52
A TANF work-eligible individual is a recipient of assistance who is an adult (age 18 or older) or a
minor head of household. Some assistance recipients are excluded from that definition:
• a minor parent (under age 18) who is not the head of a household;
• at state option, and on a case-by-case basis, (1) a parent who is a recipient of
Social Security Disability Insurance (SSDI) benefits; (2) a parent who is a
recipient of Supplemental Security Income (SSI, public assistance for those who
are age 65 or older, have a disability, or have blindness); or (3) a parent who
became eligible for SSI during the year (excluded retroactively); and
• a parent needed to care for a disabled family member, provided there is medical
documentation to support that need.
Household members living with assistance recipients who are not parents and not recipients
themselves are not considered TANF work-eligible individuals. This generally includes
nonrecipient, nonparent relatives caring for children; noncitizens who are ineligible for TANF
assistance because of their immigration status, and SSI recipients (parents and other relatives).
The definition of work-eligible individual includes some nonrecipient parents living with a child
receiving assistance. For example, parents sanctioned off of benefits for failure to meet a program

50 These regulations are at 45 C.F.R. §261.43.
51 U.S. Department of Health and Human Services, Administration for Children and Families, “Reauthorization of the
Temporary Assistance for Needy Families Program,” 73 Federal Register 6807-6808, February 5, 2008. Note that the
American Recovery and Reinvestment Act of 2009 (P.L. 111-5) effectively delayed the implementation of these rules
until FY2012.
52 The definition of work-eligible individual is found in regulation at 45 C.F.R. §261.2(n).
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requirement or parents who (under state policy) ceased receiving benefits because of a time limit
while benefits were continued for the children are considered work-eligible individuals.
Families Included in the TANF Work Participation Rate
Only families receiving assistance from federal TANF or state MOE funds that include a work-
eligible individual are included in the participation rate calculation. However, some such families
are or may be excluded by statute. Excluding these families means the state may exempt them
from work requirements without creating the potential for their nonparticipation to result in a
lower participation rate.
The families excluded from the participation rate are those
• (at state option) with a single parent caring for a child under the age of one—this
exclusion is limited to a maximum of 12 months in a lifetime for the family;
• (at state option) participating in a tribal TANF or tribal work program; or
• subject to a sanction for refusal to comply with work requirements, for up to 3
months in a 12-month period.53
Engaged in Work
Work-eligible individuals must participate in specific activities during a month to be considered
engaged in work. Work-eligible individuals must also participate in activities for a minimum
number of hours per week in a month to be considered engaged in work.
Activities That Are Countable
Federal law lists 12 categories of activities creditable toward meeting the TANF work
participation standard. HHS regulations define what specific types of activities count under each
of the 12 categories. Table A-1 lists the 12 creditable categories of activities and the HHS
regulatory definition for each. As shown in the table, the specific activities included in the 12
categories are fairly comprehensive, and include education (including attendance at four-year
colleges) and rehabilitative activities. However, as will be discussed below, the pre-employment
activities of job search and readiness assistance and education activities are limited in terms of
how long or under what circumstances they can be counted toward the official participation
standard.
Table A-1. TANF Work Activities and Their Definitions
Activity

Definition
Unsubsidized employment

Ful - or part-time employment in the public or private sector that is not
subsidized by TANF or any other public program.

53 Guidance from HHS notes that a family is not subject to a sanction until the sanction is actually imposed. The state
may not disregard the family from the WPR during the period of time after which notice is given that the family is not
in compliance or during a period of conciliation, but before the financial sanction is imposed. U.S. Department of
Health and Human Services, Administration for Children and Families, Office of Family Assistance, Policy on “subject
to a penalty” for refusing to participate in work activities, TANF-ACF-PI-2007-05, October 1, 2007,
https://www.acf.hhs.gov/ofa/policy-guidance/tanf-acf-pi-2007-05-policy-subject-penalty-refusing-participate-work-
activities.
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Activity

Definition
Subsidized private sector

Employment in the private sector for which the employer receives a subsidy
employment
from TANF or other public funds to offset some or all of the wages and costs
of employing an individual.
Subsidized public sector

Employment in the public sector for which the employer receives a subsidy
employment
from TANF or other public funds to offset some or all of the wages and costs
of employing an individual.
Job search and readiness

The act of seeking or obtaining employment, or preparation to seek or obtain
assistance
employment, including life-skil s training and substance abuse treatment,
(participation in this activity
mental health treatment, or rehabilitation activities. Such treatment or
may be counted for six
therapy must be determined to be necessary and documented by a qualified
weeks, or 12 weeks in
medical, substance abuse, or mental health professional.
certain circumstances, in a
12-month period)
Community service

Structured programs and embedded activities in which TANF recipients
perform work for the direct benefit of the community under the auspices of
public or nonprofit organizations. Community service programs must be
limited to projects that serve a useful community purpose in fields such as
health, social service, environmental protection, education, urban and rural
redevelopment, welfare, recreation, public facilities, public safety, and child
care. A state agency shall take into account, to the extent possible, the prior
training, experience, and skil s of an individual in making appropriate
community service assignments.
Work experience

A work activity, performed in return for assistance that provides an individual
with an opportunity to acquire the general skil s, knowledge, and work habits
necessary to obtain employment. The purpose of work experience is to
improve the employability of an individual who cannot find unsubsidized ful -
time employment.
On-the-job training

Training in the public or private sector that is given to a paid employee while
he or she is engaged in productive work, and that provides knowledge and
skil s essential to the ful and adequate performance of the job.
Vocational educational

Organized educational programs that are directly related to the preparation
training
of individuals for employment in current or emerging occupations.
(participation in this activity
is limited to 12 months in a
lifetime)
Caring for a child of a

Providing child care to enable another cash assistant recipient to participate in
recipient in community
a community services program. This is an unpaid activity and must be a
service
structured program to improve the employability of participating individuals.
Job skil s training directly

Training or education for job skil s required by an employer to provide an
related to employment
individual with the ability to obtain employment or to advance or adapt to the
changing demands of the workplace.
Education directly related to

Education related to a specific occupation, job, or job offer.
employment (for those
without a high school or
equivalent degree)
Completion of a secondary

In the case of a recipient who has not completed secondary school or
school program (for those
received such a certificate, this means regular attendance, in accordance with
without a high school or
the requirements of a secondary school or course of study, at a secondary
equivalent degree)
school or in a course of study leading to a certificate of general equivalence.
Source: Table prepared by the Congressional Research Service (CRS) based on U.S. Department of Health and
Human Services (HHS) regulations. See Federal Register, vol. 73, no. 24, February 5, 2008, pp. 6772-6828.
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Engaged in Work: Hours of Participation
To be considered a participant and counted by a state toward meeting its work participation
standard, a family member or members must be engaged in work activities for a minimum
number of hours per week in a month. The required minimums vary by the family’s composition.
Table A-2 outlines the TANF work participation hours standard. For meeting the all family
standard, the hours requirement varies depending on family type and the age of the youngest
child. The general hours requirement is an average of at least 30 hours per week during the
month. However, for single parents caring for a child under the age of 6, an average of 20 hours
per week during the month is needed in work activities for a state to deem them participants.
More hours are required for two-parent families to meet the standard. For these families, the
combined hours of both parents are considered in determining whether they can be considered
participant families.
Table A-2 shows that certain hours of participation must be in core activities, while remaining
hours may be in supplemental activities. The core activities are (1) unsubsidized employment, (2)
subsidized private sector employment, (3) subsidized public sector employment, (4) job search
and readiness, (5) community service, (6) work experience, (7) on-the job-training, (8) vocational
educational training, and (9) providing child care to a recipient in community service. The
supplemental activities are (1) job skills training directly related to employment, (2) education
directly related to employment, and (3) completion of a secondary school program.
Note that the effect of these rules on single parents with a child under 6 effectively narrows the
number of countable activities from the full 12 to the 9 core activities for the purposes of meeting
the work standards. That is, to meet the 20-hour per week requirement, only core activities count
for single parent families with a child under 6.
Table A-2. TANF Hours Requirements for the All-Family Rate and the Two-Parent
Family Rate, by Family Type
(Excludes special rule for teen parents)
Two-Parent Family Rate

All-Family Rate
(parents may combine hours)
Two-Parent
Two-Parent

Single-Parent
Families
Families Not
Families with a
Receiving
Receiving
Child Under
Other
Federally Funded
Federally Funded
Age 6
Families
Child Care
Child Care
Total hours
An average of 20
An average of 30
An average of 55
An average of 35
requirement
hours per week
hours per week
hours per week
hours per week
during the month
during the month
during the month
during the month
Required hours
An average of 20
An average of 20
An average of 50
An average of 30
in core activities
hours per week
hours per week
hours per week
hours per week
during the month
during the month
during the month
during the month
Allowable hours
Not applicable
An average of 10
An average of 5
An average of 5
in supplemental
hours per week
hours per week
hours per week
activities
during the month
during the month
during the month
Source: Table prepared by the Congressional Research Service (CRS).
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HHS regulations clarify that only actual hours of participation count toward meeting the work
participation standard; however, there is an excused absence policy. For paid activities, states are
credited for all hours for which an individual is paid, including any holidays or paid leave (e.g.,
paid sick leave). For unpaid activities, the regulations allow for up to 10 holidays plus 80 hours of
other excused absences over a year.
The regulations require that hours in unpaid activities be supervised on a daily basis. The daily
supervision requirement means that a responsible party has daily oversight of an individual’s
participation, not necessarily daily in-person contact with the participant.
Special Rules for Teen Parents Without a High School Diploma
Teen parents who are included in the TANF work participation rate calculation have a special rule
for determining whether they are engaged in work. A state may deem a teen parent who lacks a
high school diploma as engaged in work if she or he is participating in education directly related
to employment for an average of at least 20 hours per week during the month or is making
satisfactory progress toward completion of a secondary school program, including a program
leading to a General Educational Development diploma. However, such participation of a teen
parent may not count toward the participation standard if a state exceeds a cap on participation in
education. The education cap requires that no more than 30% of those considered engaged in
work may be individuals in vocational educational training and teen parents deemed engaged in
work through education.
Restrictions in Counting Work in Separate State Programs
Beginning in FY2026, states will no longer be able to count activities of those in families that
receive assistance funded through separate state programs unless the assistance amount equals or
exceeds $35 per month.
Verifying Work Participation54
States are required to have procedures to verify recipients’ work participation: identifying who is
subject to or excluded from work standards, how a recipient’s activities represent countable
TANF work activities, and how to count and verify reported hours of work. HHS regulations
require that descriptions of these procedures be included in a state work verification plan. States
that fail to comply with these work verification requirements are subject to a penalty of between
1% and 5% of the state’s block grant.

54 Section 407(i) of the Social Security Act.
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Appendix B. Detail on Penalties for Failure to Meet
TANF Requirements
Table B-1. TANF Penalties on States
(Statutory references are to sections of the Social Security Act)
Subject to Corrective
Compliance and
Reasonable Cause
Penalized Action
Description
Penalty
Exception?
Misuse of TANF grant
Based on an audit, the
Equal to the amount of
Yes
(Section 409(a)(1))
state used a grant in
TANF funds misused. If
violation of TANF rules.
the violation is found to
be intentional, an
additional penalty equal to
5% of the state’s adjusted
SFAG is assessed
(adjusted SFAG is the
amount of the basic block
grant allocated to the
state minus payments to
tribes minus transfers to
the Child Care and
Development Block Grant
and the Social Services
Block Grant).
Failure to submit required The state failed to submit
TANF SFAG block grant
Yes. Additionally, the
reports
the quarterly report on
is reduced by an amount
penalty is rescinded if the
(Section 409(a)(2))
families receiving
equal to 4% of the state’s
state files the report by
assistance by the filing
adjusted SFAG.
the end of the fiscal
deadline.
quarter fol owing the
fiscal quarter in which it
was due.
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Subject to Corrective
Compliance and
Reasonable Cause
Penalized Action
Description
Penalty
Exception?
Failure to satisfy minimum The state has not
For the first year of falling
Yes
work participation rates
achieved minimum work
short on participation
(Section 409(a)(3))
participation rates for
standards, a state’s
families receiving
adjusted SFAG is reduced
assistance.
by a maximum of 5%. For
each subsequent year of
falling short of the
standard, the penalty is
increased by 2 percentage
points. The penalty is
based on the degree of
noncompliance. For
example, if a state fails to
meet the two-parent
standard only, the
maximum penalty is pro-
rated based on the
percentage of two-parent
cases receiving assistance
as a share of the total
caseload (42 C.F.R.
§261.5). Maximum penalty
is 21% of the state’s
adjusted SFAG.
Failure to participate in
The state failed to
The state’s SFAG is
Yes
the Income Eligibility
participate in IEVS. IEVS
reduced by a maximum of
Verification System (IEVS)
requires states to operate 2% of its adjusted SFAG.
(Section 409(a)(4))
a computer matching
system to verify income
eligibility for selected
federal and state
programs.
Failure to comply with
The state did not comply
The state’s SFAG is
Yes
paternity establishment
with child support
reduced by a maximum of
and child support
requirements. States must 5% of its adjusted SFAG.
enforcement
require that families
requirements
receiving assistance
(Section 409(a)(5))
cooperate with
establishing the paternity
of dependent children.
They also must enforce
penalties on TANF
assistance recipients who
do not cooperate.
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Subject to Corrective
Compliance and
Reasonable Cause
Penalized Action
Description
Penalty
Exception?
Failure to repay in a
The state did not repay
The state’s SFAG is
No
timely way a loan
loans from the TANF loan reduced by the amount of
(Section 409(a)(6))
fund based on the terms
the outstanding loan plus
of its loan. TANF allows
interest.
states to take out loans to
help finance unanticipated
costs. These loans must
be repaid with interest,
within a maximum of
three years.
Failure to meet the TANF The state failed to meet
The state’s SFAG is
No
maintenance of effort
the requirement that
reduced dol ar-for-dol ar
(MOE) requirement
nonfederal spending in the by the amount of the
(Section 409(a)(7))
state on TANF-eligible
shortfall between
families be a specified
required spending and
percentage of historical
actual nonfederal
(FY1994) spending.
spending.
Failure to achieve certain
The CSE program
For the first year of
Yes
performance levels and
establishes certain
noncompliance, the
other requirements in the
performance measures in
state’s SFAG is reduced
Child Support
terms of paternity
by not less than 1% and
Enforcement (CSE)
establishment, and has
not more than 2% of the
program, Title IV-D of the other requirements.
state’s adjusted SFAG.
Social Security Act
Failure to meet the
This penalty is increased
(Section 409(a)(8))
performance measures,
to not less than 2% nor
submitting unreliable data
more than 3% for the
to evaluate performance,
second consecutive year
or not complying with
of noncompliance, and to
other CSE requirements
not less than 3% nor
is enforced through a
more than 5% for the
penalty in TANF.
third or subsequent years
of noncompliance.
Failure to comply with the The number of families
The state’s SFAG is
Yes
five-year time limit
that include the head of
reduced by 5% of the
(Section 409(a)(9))
household receiving
state’s adjusted SFAG.
assistance in the state
beyond 60 months
exceeds 20% of the total
number of families
receiving assistance.
Failure to meet the 100%
The state received TANF
The state is required to
No
of historical state
contingency funds but
return all TANF
spending requirement for
nonfederal funds spent on
contingency funds it has
TANF contingency funds
eligible families in the
received.
(Section 409(a)(10))
state (on activities other
than child care) were less
than 100% of historical
state spending (on
activities other than child
care).
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Subject to Corrective
Compliance and
Reasonable Cause
Penalized Action
Description
Penalty
Exception?
Failure to maintain
The state is prohibited
The state’s SFAG is
Yes
assistance for a family
from sanctioning a single
reduced by a maximum of
with a single parent and
parent family with a
5% of the state’s adjusted
child under age 6 who
preschool (under age 6)
SFAG.
cannot obtain affordable
child who receives
child care
assistance for not
(Section 409(a)(11))
complying with work
requirements if the family
cannot obtain affordable
child care.
Failure to replace
States are required to
The state’s SFAG is
No
penalized funds
replace penalties levied on reduced by the amount
(Section 409(a)(12))
federal funds with state
the state was required to
funds. A state that does
replace plus a maximum
not do this is subject to
of 2% of the state’s
an additional penalty.
adjusted SFAG.
Failure to sanction
States are required to
The state’s SFAG is
Yes
families for recipients who sanction families receiving
reduced by not less than
refuse without good
assistance if a member
1% but not more than 5%
cause to work
refuses without good
of its adjusted SFAG.
(Section 409(a)(14))
cause to work or engage
in job preparation
activities. States that are
found in violation of this
requirement are
penalized.
Failure to establish or
The state has not
The state’s SFAG is
Yes
comply with work
submitted a plan, or is not reduced by not less than
verification procedures
complying with the
1% but not more than 5%
(Section 409(a)(15))
requirement that it
of its adjusted SFAG.
submit a plan, to verify
work participation of
assistance recipients.
Failure to enforce
States must maintain
The state’s SFAG is
Yes
prohibition on
policies and practices to
reduced by a maximum of
withdrawals of TANF
prevent TANF cash
5% of its adjusted SFAG.
cash assistance in certain
assistance funds from
establishments
being used in an EBT
(Section 409(a)(16))
transaction in liquor
stores, casinos or gaming
establishments, and strip
clubs.
Source: Congressional Research Service (CRS), based on Section 409 of the Social Security Act and applicable
regulations.
Note: Penalties expressed as “a maximum of” indicate a penalty that may be reduced by the severity of the
violation.

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Author Information

Gene Falk

Specialist in Social Policy

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
shared staff to congressional committees and Members of Congress. It operates solely at the behest of and
under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in
its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or
material from a third party, you may need to obtain the permission of the copyright holder if you wish to
copy or otherwise use copyrighted material.

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