What Is a Low Income Earner?


A low income earner is a person who makes less than the average amount of money in the place where he lives, or who is below or around the poverty line. The financial aid service FinAid notes that while the term “low income” is bandied about by public and private organizations, no one has a widely accepted definition.

Poverty Guidelines

In the United States, private and public organizations often tie their institutional definitions of low income earners to Department of Health and Human Services’ annual poverty guidelines. The poverty line is an amount in which HHS determines every household needs to pay for the most basic goods and services. At time of publication, the poverty line for one person was $10,890, $14,710 for a household of two people and $18,530 for a family of three.


Many agencies use the poverty guidelines as a base or benchmark and then take percentages of the guidelines to establish a definition of low income. For example, the Sloan Work and Family Research Network at Boston College defines low income as a family or household making less than 200 percent of the poverty line for the number of people in the family (for example, less than $37,060 for a family of three).


The Internal Revenue Service defines earned income as any money that a person receives by doing work for someone else or for his own business. Low income earners have less money, and they also earn that through work. People who qualify as low income may not qualify as low income earners if they get their money through Social Security, disability pay or family and friends.

Lack of Consensus

Always check an organization's definition before assuming that guidelines you have seen elsewhere apply to any particular group. For example, the Department of Agriculture’s food stamp program uses percentages based on HHS poverty guidelines while nonprofit organizations may use local statistics and bankruptcy courts use the average income in a filer’s state of residence. Understanding differences will help you save time if you need to file low income earning paperwork with a given organization.

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