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Glossary

Unearned income

Money you receive that is not from a job you work at, such as Social Security, unemployment benefits, or child support.

Unearned income is money you get without actively working for it. Common examples include:

  • Social Security benefits
  • Unemployment insurance
  • Child support or alimony
  • Pensions or retirement account withdrawals
  • Interest, dividends or rental income
  • Gifts or inheritances

Unearned income matters for many benefit programs. When you apply for SNAP (the Supplemental Nutrition Assistance Program), Medicaid, WIC (Women, Infants & Children), TANF (cash assistance for families), child care assistance, LIHEAP (help paying energy bills), or housing assistance, the agency will count your unearned income along with earned income to decide if you qualify. Generally, the more unearned income you have, the less likely you are to qualify for assistance.

When you apply for a benefit program, be ready to report all sources of unearned income. Applying is free, and only the agency decides if you qualify.

Programs where this matters

LIHEAPHHS Administration for Children and FamiliesLIHEAP helps households with low income pay heating and cooling bills, and may help in an energy crisis such as a shut-off notice.MedicaidCenters for Medicare & Medicaid ServicesMedicaid is free or low-cost health coverage run by each state with federal funding, for children, adults, pregnant people, older adults and people with disabilities.SNAPUSDA Food and Nutrition ServiceSNAP gives monthly benefits on an EBT card to help households with low income buy food.WICUSDA Food and Nutrition ServiceWIC gives healthy foods, nutrition education and breastfeeding support to pregnant women, new mothers, infants and young children with low income.Child Care AidHHS Administration for Children and FamiliesChild care assistance helps families with low income pay for child care so parents can work, look for work, or go to school or training.SSISocial Security AdministrationSSI pays monthly cash to people with limited income and resources who are older, blind or have a disability.Section 8US Department of Housing and Urban DevelopmentHousing Choice Vouchers, often called Section 8, help families with low income pay rent for a home they find in the private market.TANFHHS Administration for Children and FamiliesTANF gives cash help and support services to families with children who have low income. Each state runs its own program.UnemploymentUS Department of Labor / state workforce agenciesUnemployment insurance pays temporary cash benefits to workers who lose their jobs and meet their state's rules.SSDISocial Security AdministrationSSDI pays monthly benefits to people who cannot work because of a disability and who have worked and paid Social Security taxes.