Every year, the U.S. Department of Housing and Urban Development calculates income limits based on Area Median Income (AMI) data for each region. These limits determine who can access public housing, Section 8 vouchers, and other federally subsidized housing programs. The limits are not one-size-fits-all. They vary by location, household size, and the specific program you are applying to.
Understanding Area Median Income
Area Median Income is the statistical midpoint of all household incomes in a defined geographic area. If the AMI for the Huntsville metropolitan area is $73,600 for a family of four, that means half of all four-person families in the area earn more than that amount and half earn less.
HUD uses AMI as the baseline for establishing three income categories that govern eligibility for housing programs:
- Extremely Low Income (ELI): At or below 30% of AMI. These households have the greatest need and often receive the highest priority on waiting lists.
- Very Low Income (VLI): At or below 50% of AMI. This is the primary eligibility threshold for Section 8 Housing Choice Vouchers.
- Low Income (LI): At or below 80% of AMI. This is the maximum threshold for most public housing programs.
Huntsville Area Income Limits by Household Size
The following table shows approximate HUD income limits for the Huntsville-Decatur-Albertville metropolitan area. These figures are updated annually, so always verify the current limits with your local PHA or through the HUD income limits dataset.
| Household Size | 30% AMI (ELI) | 50% AMI (VLI) | 80% AMI (LI) |
|---|---|---|---|
| 1 Person | $15,500 | $25,800 | $41,250 |
| 2 Persons | $17,700 | $29,450 | $47,150 |
| 3 Persons | $22,100 | $33,150 | $53,050 |
| 4 Persons | $26,500 | $36,800 | $58,900 |
| 5 Persons | $30,900 | $39,750 | $63,650 |
| 6 Persons | $35,250 | $42,700 | $68,350 |
Note that these figures are approximations based on recently published HUD data. Actual limits may differ slightly depending on the exact publication year and any HUD adjustments for high-cost or low-cost areas.
What Counts as Household Income
PHAs follow HUD guidelines for calculating annual income, which cast a wide net. The following sources are generally counted toward your household's total income:
- Gross wages and salaries from employment (before taxes)
- Net income from self-employment or a business
- Social Security benefits, including SSI and SSDI
- Pension and retirement income
- Unemployment compensation
- Child support and alimony received
- Regular contributions or gifts from persons outside the household
- Interest, dividends, and other net income from assets
Income That Is Not Counted
Certain types of income are excluded from the calculation. These include earnings of household members under 18, one-time lump-sum payments (such as insurance settlements), income from the sale of personal property, and amounts received specifically for reimbursement of medical or care expenses. Food stamps (SNAP benefits) and most educational grants are also excluded.
Deductions That Lower Your Calculated Income
Even if your gross income is above the limit, HUD-mandated deductions may bring your adjusted income below the threshold. PHAs apply the following standard deductions when calculating eligibility:
- Dependent allowance: $480 per year for each dependent household member (typically children under 18 or full-time students)
- Elderly/disabled household allowance: $400 per year if the head of household, spouse, or sole member is elderly (62+) or disabled
- Medical expense deduction: Unreimbursed medical expenses exceeding 3% of annual income for elderly or disabled families
- Childcare deduction: Reasonable childcare costs that enable a household member to work, seek employment, or attend school
- Disability assistance expense deduction: Costs for attendant care or auxiliary apparatus that enable a disabled household member to work
How Income Affects Your Rent
In public housing, your monthly rent is typically set at 30 percent of your adjusted monthly income. This means a family earning $24,000 per year (before deductions) would pay approximately $600 per month in rent. After applying deductions for dependents or medical expenses, the actual rent could be lower. The Alabama eligibility guide covers the full application process, including how your income is verified.
When Income Limits Are Checked
Your income is evaluated at three points: when you first apply, when you reach the top of the waiting list and attend your eligibility interview, and at annual recertification after you are housed. If your income increases above the limits after you are already in the program, you are generally not removed immediately, but your rent will be adjusted upward. In some cases, families whose income exceeds 120 percent of AMI for an extended period may be asked to transition out of the program.
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Find out if your household income qualifies for housing assistance at Huntsville Housing Authority.
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