TANF Is a Vital Resource for People Facing Hardship but Needs to Reach More Families

Everyone, regardless of income, race, or where they live, should be able to meet their basic needs. For families experiencing poverty, cash assistance through the Temporary Assistance for Needy Families (TANF) program can be a vital lifeline, enabling them to pay for rent, utilities, diapers, food, transportation, and other necessities while maintaining financial stability. Families also turn to TANF during times of crisis; TANF cash assistance can help a family facing eviction avert homelessness or help a survivor of domestic violence take steps toward financial independence. Yet only 21 out of every 100 families with children in poverty nationwide received TANF cash assistance in 2023, and in many states the figure was far lower. State and federal lawmakers can take a number of steps to transform TANF so it reaches many more families in poverty.

Beyond helping families meet immediate needs, many studies show that policies and programs like TANF, which increase family income, can also improve children’s academic, health, and economic outcomes.^[2] A study published by the National Bureau of Economic Research estimates that for every $1,000 provided annually to families with children, society reaps $5,603 in benefits, including through increased earnings among adults and better health outcomes among children.^[3]

This report explores recent state and nationwide trends in TANF access using the “TANF-to-poverty ratio” (TPR), which measures the number of families receiving TANF for every 100 families experiencing poverty. We also outline recommendations for state and federal policymakers that would enable TANF to advance economic security for more families in poverty.

TANF’s Reach Has Declined Significantly Over Time

In the years after TANF’s creation in 1996, the nationwide TPR fell steadily, reflecting a decline in the share of families in poverty receiving assistance — a decline largely due to extremely restrictive state eligibility policies. The nationwide TPR plummeted from 68 families per 100 in poverty in 1996 to 19 families per 100 in poverty in 2021. The trend then saw a slight reversal, with the TPR rising to 20 families per 100 in poverty in 2022 and then to 21 families in 2023. Still, if TANF had the same reach in 2023 as its predecessor, Aid to Families with Dependent Children (AFDC), did in 1996, it would have helped about 2.4 million more families nationwide that year.

Among recent factors affecting TPR trends, between the start of the COVID-19 pandemic in 2020 and 2023 the nationwide TPR improved slightly as the TANF caseload — that is, the number of families receiving TANF cash assistance — fell slightly less than the number of families with children in poverty. While caseloads rose at the beginning of the pandemic as more families turned to TANF to make ends meet amid widespread hardship, caseloads then declined between 2021 and 2023. Similarly, the official poverty rate rose in 2020, due in large part to the pandemic and resulting economic crisis, but then remained about the same in 2022 and fell in 2023.

Access to TANF Varies Significantly by State

A family’s ability to meet their needs should not depend on where they live, but in practice, access to TANF varies significantly by state. In 2023, the TPR ranged from 65 in California to just 2 in Arkansas and Texas.^[4] Nineteen states had TPRs of 10 or less. (See Figure 1.)

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State Trends 2020-2023

Over half of the states saw either no change or a nominal decline in their TPRs between 2020 and 2023. Some states, however, experienced more notable shifts over that period, in either direction:

• Significant increases in TPRs were mainly driven by declines in poverty among families with children. Delaware, Massachusetts, Rhode Island, and Virginia saw their TPRs rise by seven or more. In most of these states, fewer families were in poverty, which raised the TPR. Virginia was an exception: both the number of families in poverty and the TANF caseload increased — another pathway to a higher TPR.
• Significant decreases in TPRs were driven by reductions in both poverty and TANF caseloads. Hawai‘i, Maryland, Minnesota, and Vermont saw their TPRs drop by ten or more. In most of these states, fewer families were in poverty, but TANF caseloads fell even more. Standing out is Minnesota, where the TPR fell sharply from 68 to 41, due to both a decline in TANF caseload and an increase in poverty among families with children.

Policy Changes May Have Impacted TANF Access in Some States

Temporary pandemic-era policies may have played a role in the temporary rise and fall in states’ TANF caseloads between 2020 and 2023. Policies varied across states, with some states lifting work requirements in all or some cases, suspending existing sanctions and time limits, and providing families additional benefits either once or over a period of months.^[5]

• Delaware was one of only two states that provided extra benefits across a period of 12 to 21 months, and Massachusetts was one of six states that issued a one-month additional benefit. Both states saw significant TPR increases over the 2020-2023 period. In Maryland, the other state to provide extra benefits across a longer period, TANF caseloads rose starting at the beginning of the pandemic in the spring of 2020 but then began to decline in the summer of 2021 as the extra benefits ended. Caseloads continued to decline through 2022 and 2023, contributing to a sharp decline in the state’s TPR between 2020 and 2023.
• Delaware, Massachusetts, and Virginia were among the only eight states that suspended time limit policies, and Maryland and Rhode Island provided families with a time limit extension.^[6] All of these states except Maryland saw significant TPR increases over 2020-2023.

Policies unrelated to pandemic response may have also impacted TANF caseloads and poverty numbers across states. For example, in Massachusetts a TANF benefit increase implemented in 2023 could have contributed to the subsequent increase in the state’s TANF caseload.^[7]

TANF Can Do More to Help Families Thrive

Many families with the very lowest incomes rely on TANF income support to help them afford the rising costs of essentials like housing, food, child care, and health care, and to address crises like domestic violence and eviction.^[8] In 2023, the average monthly earnings that a family of three could have and remain eligible for TANF benefit assistance was just $1,056.

But TANF can and should do more. While one TANF participant in a mixed-method research study conducted by the Heartland Alliance’s Social Impact Research Center shared that TANF income support helped her make rent payments and care for her children, another participant described her difficulties with the program as a Black woman and her experience facing unfair negative stereotypes. She stated that she had to endure a lengthy questioning process and thought the “whole system lacks passion for people.”^[9] By embedding a dedicated TANF Liaison — someone whose job is to guide families through eligibility rules, sanction risks, administrative burdens, and program deadlines — agencies could dramatically reduce barriers that disproportionately affect Black families and survivors of intimate partner violence. This model promises to improve benefit retention and receipt by simplifying program compliance, clarifying rights (i.e., via “good cause” waivers), and ensuring families are not lost due to administrative hurdles rather than eligibility concerns.^[10]

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To improve outcomes for families and client experiences when they need help, state and federal TANF policy changes should focus on serving more families who need assistance, providing adequate benefit levels, eliminating the program’s deep racial disparities, and ensuring that adequate resources are available to achieve these goals. (Figure 2).

States have considerable flexibility over TANF and can make a number of changes in pursuit of these goals. For example, states should:

• Eliminate harmful behavioral requirements that restrict families’ access to TANF cash assistance. States should repeal “family cap” policies, which deny additional cash benefits to families who have children after their initial TANF eligibility is determined. Family cap policies are designed to punish women for their reproductive decisions and result in deeper poverty for families and the youngest children.^[11]
• End punitive sanctions and time limits, which take benefits away from struggling families. Two of the main causes of TANF’s dramatic caseload decline are full-family sanctions, which cut off the whole family from assistance (including the children) when a parent didn’t meet a work requirement, and time limits on assistance. These harsh sanctions too often occur when states have missed or failed to address underlying challenges, like health care needs or unstable housing, that impede parents’ ability to work or succeed in work activities. Once imposed, they sever the connection between the family and the TANF program and leave families and their children destitute.
• Expand financial eligibility and increase benefit levels. In many states, a family must have incomes far below the poverty line and extremely meager assets to receive TANF; as a result, many families in need don’t qualify. For example, to qualify for TANF in Georgia and Texas, a family’s assets cannot exceed $1,000. This means families can’t get help until their families are in economic crisis and stabilizing their circumstances may be even more difficult. States should raise their income thresholds and eliminate asset tests to broaden eligibility for more families in need. States should also increase TANF’s low benefit levels to help families afford necessities and address crises when they arise. Benefits are at or below 60 percent of the poverty line in every state and below 20 percent in 17, mostly Southern, states.^[12]
• Strengthen the Family Violence Option (FVO)to better protect survivors of domestic violence. Cash assistance programs like TANF can help survivors build the financial stability necessary to leave abusive situations and rebuild their lives.^[13] The FVO, part of the 1996 law that created TANF, is designed to accommodate the particular challenges facing survivors of domestic violence. It allows states to screen TANF participants for domestic violence, refer survivors to services, and provide them with waivers from TANF program requirements. (For example, a domestic violence survivor may need to be excused from work and job training requirements so they can find a new place to live, enroll their children in new schools, open a bank account, or attend to their family’s physical and behavioral health needs.) Despite widespread state adoption of the FVO, data indicate that few families are granted waivers, which underscores the need for states to both expand and improve FVO use nationwide.^[14]

Federal policymakers can also make important improvements to TANF. Congress should:

• Hold states accountable for serving families in need. Congress should remove incentives that encourage states not to assist families, which enables them to use the savings to fund other priorities or to fill in budget holes. Congress also should create a state accountability measure focused on serving families in need, such as the TPR.
• Require states to direct a specified share of spending to cash assistance. TANF’s purposes are broad, which has given states the flexibility to spread program funds throughout their budgets and allowed them to shift resources away from assistance to families with the lowest incomes. To better target resources, Congress should require states to direct a specified share of their state and federal TANF funds to basic assistance.
• Increase TANF funding. Because of inflation, the TANF block grant is worth nearly 50 percent less than when it was created in 1996. Funding should be increased so that every family who needs TANF support can access it. 

Appendix A: Methodology and Source Notes

TANF Caseload Data

In this analysis, AFDC/TANF caseload data from January 1979 through August 2006 were collected from the U.S. Department of Health and Human Services (HHS). Beginning with September 2006, this analysis uses caseload data collected directly from the states rather than the official data reported by HHS, as the state data more consistently reflect the number of families with children receiving cash assistance in each state over time.

These state data differ from the official HHS TANF data in two important ways. First, they include cases from solely state-funded programs. In most instances, these families had been in state TANF programs but were shifted to a solely state-funded program on or after October 2006, when the Deficit Reduction Act of 2005 (DRA) took effect, because states anticipated these families would not be able to meet TANF work participation requirements and thus would lower the state’s work participation rate. These cases are not included in the data reported to HHS as no TANF or state maintenance-of-effort (MOE) funds are used. While these families are not counted in the HHS TANF caseload numbers, they generally are seen as part of the state’s cash assistance program and continue to receive the same or comparable benefits as when they were on TANF.

Second, unlike the HHS data, the state data exclude cases in worker supplement programs, through which states provide modest TANF- or MOE-funded cash payments to working families. States generally created these programs after the passage of the DRA. Because these supplements make additional families eligible (or make current recipients eligible for a longer period of time), they increase the TANF or MOE caseloads that states report to HHS. Often, states provide a very small cash grant to these families — as little as $8 to $10 per month. The main purpose of these small grants is to raise the percentage of TANF families who are meeting their work participation requirement, thereby helping states meet their work participation requirement.

Including solely state-funded programs and excluding worker supplement programs in the caseload data used for our analysis provide us with a more consistent trend of the number of families receiving cash assistance in each state over time.

Data on the Number of Families With Children in Poverty

The number of families with children in poverty was calculated using Current Population Survey (CPS) data and the official Census poverty thresholds. We counted related subfamilies and primary families in a single household as one family but counted and determined the poverty status of unrelated subfamilies separately. “Deep poverty” refers to families with incomes below half the poverty line, which in 2023 was about $12,000 for a family of three. Two years of CPS data were merged to improve reliability for state estimates.

Ratio of Families Receiving TANF to Families in Poverty

Ratios are calculated by dividing the number of TANF cases (based on administrative data from HHS or, since late 2006, data collected from states by CBPP) by the number of families with children in poverty (CPS data). We use two-year averages for these calculations to improve reliability.

These ratios should not be interpreted as the percentage of families with children in poverty served by TANF because the number of families receiving TANF is not a perfect subset of the number of families in poverty. A family above poverty could receive TANF benefits, for example: some families may be below the poverty line in the months they receive TANF but have higher incomes for the rest of the year; states may encourage work by continuing partial TANF benefits for certain families with earnings slightly above the poverty line; and in some households, large extended families may contain more than one eligible TANF case unit. For these reasons, it’s possible for a state to have more than 100 TANF families for every 100 families with children in poverty.

Using the Alabama ratio as an example, the data should be described as follows: In 1995, for every 100 Alabama families with children in poverty, AFDC served 32 families. In 2023, 7 families participated in TANF for every 100 families with children in poverty.

In Alaska and Hawai‘i, the TANF-to-poverty ratio was above 100 in 1995-96. The HHS poverty guidelines used in determining program eligibility in these two states are significantly higher than the Census poverty thresholds used in determining the number of families in poverty. (This is not true for any of the other 48 states. HHS poverty thresholds are set higher in Alaska and Hawai‘i to allow for the higher cost of living in these two states but do not vary elsewhere. The Census Bureau’s poverty thresholds do not vary for any state.)

Appendix B