Your Total Tenant Payment, or TTP, is the monthly amount HUD says your household owes toward housing costs in the Housing Choice Voucher (Section 8) and public housing programs. It is not simply 30 percent of your income. Your housing agency runs several calculations and your TTP is whichever result is highest, rounded to the nearest dollar. For most families, that ends up being roughly 30 percent of adjusted monthly income, but a minimum rent floor, a gross income calculation, or a designated welfare housing amount can override it.
The Formula Behind the Number
Your agency compares up to five figures. The highest one becomes your TTP.1eCFR. 24 CFR 5.628 – Total Tenant Payment
- 30 percent of monthly adjusted income. Divide adjusted annual income by 12, multiply by 0.30. This drives TTP for most working families.
- 10 percent of monthly gross income. Uses total income before deductions. It only becomes the controlling figure when deductions are unusually large.
- Welfare housing contribution. If a public agency designates a specific portion of your welfare payment for housing, that designated amount enters the comparison.
- Minimum rent. A floor set by your local housing agency somewhere between $0 and $50 per month.
- Alternative non-public housing rent. Applies only in public housing, under 24 CFR 960.102, for certain over-income families.
A worked example makes this concrete. Suppose a family of three has $28,000 in annual income and qualifies for a single $500 dependent deduction. Adjusted income is $27,500. Thirty percent of monthly adjusted income comes to roughly $688. Ten percent of monthly gross income is about $233. With no welfare housing contribution and a $50 minimum rent, TTP is $688, because it is the highest of the four.
How HUD Counts Your Income
Annual income is the starting point. HUD counts all amounts received by each household member who is 18 or older, or who is the head of household or spouse regardless of age, plus unearned income received on behalf of children under 18. Wages, Social Security, pensions, interest, rental income, and most other recurring cash go into the total.2eCFR. 24 CFR 5.609 – Annual Income
“All sources” is broader than most people expect. An adult child’s part-time wages count. So do recurring gifts or regular contributions from someone outside the household. Before any review, gather pay stubs, benefit letters, bank statements, and tax returns. Agencies verify electronically, and gaps between what you report and what shows up in their system create problems fast.
Income That Does Not Count
The regulation excludes a long list of items that can meaningfully lower your annual income figure. Earned income of children under 18 is excluded entirely. So are foster care payments, insurance settlements for personal injury or property loss, amounts received as reimbursement for medical expenses, and most student financial aid used for tuition, books, and required fees. Income of a live-in aide is excluded, as are combat zone special pay for military families and distributions from Coverdell education savings accounts and 529 college savings plans.3eCFR. 24 CFR 5.609 – Annual Income
A teenager’s summer job earnings will not increase your rent. Neither will a lump-sum insurance payout after a car accident. If your housing agency counted something that should have been excluded, you have the right to challenge the calculation.
Deductions That Lower Your Adjusted Income
Once annual income is set, HUD allows four mandatory deductions to arrive at adjusted income, the figure that actually drives most TTP calculations. The dollar amounts adjust for inflation each year, so last year’s figures will produce the wrong result.4eCFR. 24 CFR 5.611 – Adjusted Income
- Dependent deduction of $500 per dependent for 2026.5HUD User. CY 2026 Revised Amounts and Passbook Rate
- Elderly or disabled family deduction of $550 per household, not per person, when the head, spouse, or sole member is elderly or disabled. This is a single flat deduction regardless of how many qualifying members live in the home.
- Health and disability expenses, for elderly or disabled families only. Unreimbursed medical costs and disability-related care are deductible to the extent they exceed 10 percent of annual income. The disability-related portion (attendant care, adaptive equipment) cannot exceed the earned income it enables.
- Reasonable childcare expenses that allow a family member to work or attend school. The regulation sets no age limit on the child; what matters is that the expense is necessary for employment or education.
The Medical Expense Threshold Under HOTMA
Before the Housing Opportunity Through Modernization Act, families could deduct medical costs exceeding just 3 percent of annual income. The new threshold is 10 percent, which reduces this deduction for many elderly and disabled households.6HUD Exchange. HOTMA Resident Fact Sheet – Health, Medical, and Childcare Deductions
HUD required a two-year phase-in for families already receiving the deduction. In the first year after the change, the threshold is 5 percent of annual income. In the second year it rises to 7.5 percent. By the third year the full 10 percent applies. A general hardship exemption also exists: families struggling to pay rent who don’t qualify for an interim income review can request a reduced 5 percent threshold at any time.6HUD Exchange. HOTMA Resident Fact Sheet – Health, Medical, and Childcare Deductions
What You Actually Pay the Landlord
TTP is your total housing cost obligation, but it doesn’t all go to the property owner. When you pay utilities directly, the housing agency subtracts a utility allowance from your TTP to arrive at your “tenant rent,” which is the amount you actually pay to the landlord. The utility allowance is based on a schedule estimating typical costs for a unit of your size and type in your area, not your actual bills.7U.S. Department of Housing and Urban Development. Housing Choice Voucher Program Guidebook – Utility Allowances
Sometimes the utility allowance exceeds the TTP. When that happens, you owe nothing to the landlord and the housing agency issues a utility reimbursement, either to you or directly to the utility company, covering the difference. Some families never claim this because they don’t realize the reimbursement exists.7U.S. Department of Housing and Urban Development. Housing Choice Voucher Program Guidebook – Utility Allowances
The Payment Standard for Voucher Holders
For Housing Choice Voucher families, TTP is only half the rent equation. The other half is the payment standard, the maximum subsidy amount your housing agency will cover for a given unit size in your area. If the unit’s gross rent (rent plus utilities) is at or below the payment standard, you pay your TTP and the voucher covers the rest.8U.S. Department of Housing and Urban Development. Housing Choice Voucher Program Guidebook – Payment Standards
If you choose a unit where gross rent exceeds the payment standard, you pay your TTP plus the entire gap. That gap comes straight out of your pocket, with no subsidy applied. At initial lease-up, there is a hard cap: your total share cannot exceed 40 percent of adjusted monthly income. If a unit would push you past that line, the housing agency cannot approve the tenancy.9eCFR. 24 CFR 982.508 – Maximum Family Share at Initial Occupancy
The 40 percent cap only applies when you first move in. After that, if the payment standard drops or your income changes, your share can climb past 40 percent at recertification. Families who signed a lease when things were affordable sometimes get squeezed later. Run the numbers before each annual review.
Minimum Rent and Hardship Exemptions
Even if your income drops to zero, you still owe something. Your local housing agency sets a minimum rent between $0 and $50 per month. The specific amount is a policy decision. One agency might set it at $50 while another sets it at $25.10eCFR. 24 CFR 5.630 – Minimum Rent
If even that amount is unmanageable, you can request a financial hardship exemption. Qualifying situations include losing eligibility for a government assistance program, awaiting an eligibility determination, facing eviction because you cannot pay the minimum rent, or experiencing a significant income loss such as a death in the family. The agency must suspend the minimum rent while it reviews your claim. If the hardship is temporary, the exemption lasts until the situation resolves. If the agency determines the hardship is long-term, the exemption continues for as long as it persists.10eCFR. 24 CFR 5.630 – Minimum Rent
The Flat Rent Alternative in Public Housing
Public housing residents get a choice that voucher holders do not. Once a year, you can opt for a flat rent instead of income-based rent. The flat rent must be at least 80 percent of the applicable Fair Market Rent for your area. For families with rising incomes, flat rent can be the better deal because it stays the same regardless of how much you earn.11eCFR. 24 CFR 960.253 – Choice of Rent
The housing agency must offer this choice annually. If you pick flat rent and later hit financial trouble, you can request a switch back to income-based rent through a hardship process. If you pick income-based rent, TTP is calculated using the formula above. The decision resets once a year, so there is no long-term lock-in.
If the Number Looks Wrong
Mistakes happen, and you are not stuck with the result. In the Housing Choice Voucher program, you have the right to an informal hearing whenever the housing agency makes a determination about your annual or adjusted income, utility allowance, or unit size, all of which affect TTP. The agency must notify you that you can request an explanation of how it reached its decision and, if you disagree, request a hearing.12eCFR. 24 CFR 982.555 – Informal Hearing for Participant
In public housing, a parallel grievance procedure exists under 24 CFR Part 966. Grievances are presented to the housing authority or the project office where you live, but the core right is the same: you can formally challenge a rent determination you believe is wrong.
Most families drop the ball here. A notice arrives, the rent goes up, they assume the agency is right, and they absorb the cost. If an income source looks double-counted, a deduction was missed, or an exclusion was ignored, request the written explanation immediately. A $50-per-month error compounding over a year is $600 you won’t get back once you’ve paid it.