Family income must be at or below 85 percent of the state median income (SMI) and family assets cannot exceed $1 million. Lead Agencies have the flexibility to set the maximum income for eligibility as long as it does not exceed 85 percent of SMI. Every state is now required to have two-tier eligibility, unless the initial eligibility threshold is set at 85 percent of SMI.

Lead Agencies may deduct or exclude some types of income when determining eligibility. Common exclusions include federal and state tax credits; income from scholarships, grants, and loans; means-tested government benefits (such as Temporary Assistance for Needy Families [TANF], Social Security, and the Supplemental Nutrition Assistance Program [SNAP]); in-kind income; child support payments or arrearages; and nonrecurring lump-sum benefits. Lead Agencies can also exclude income from certain family members. Common exclusions include income from children younger than 18, minor parents and their parents, and foster parents and subsidized guardians.