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The 30% rule: how your Section 8 rent share is actually calculated

Last updated June 13, 2026

You've probably heard that a Housing Choice Voucher covers "the rent above 30% of your income." That's close, but the actual formula your PHA uses — what HUD calls your Total Tenant Payment, or TTP — has a few more moving parts. Knowing them is the difference between a number that's roughly right and one that matches what shows up on your paperwork.

It starts with "adjusted income," not your paycheck

Your TTP isn't based on your gross income — it's based on adjusted income, which is your household's gross annual income minus a set of deductions HUD allows. The most common ones:

  • A per-dependent deduction for each household member under 18, full-time student, or disabled adult who isn't the head of household or spouse.
  • An additional deduction for elderly or disabled households (anyone 62+, or with a qualifying disability, as head of household or spouse).
  • Unreimbursed medical expenses, for elderly or disabled households, above a small percentage of income.
  • Childcare or disability-assistance expenses that allow a household member to work, look for work, or attend school.

Which of these apply — and whose income even counts toward the total in the first place — depends heavily on who's actually living in the unit. If your household includes an elderly or disabled member, see Section 8 for elderly and disabled households for how those deductions work in practice. If you're raising kids, Bedrooms, deductions, and lead paint covers the dependent and childcare deductions in more detail. And if your household spans generations under one roof, how Section 8 treats multigenerational households explains whose income gets counted at all.

The 30% calculation

Once your adjusted income is set, your PHA calculates your TTP as the highest of:

  1. 30% of your monthly adjusted income,
  2. 10% of your monthly gross income,
  3. a welfare-rent amount (only relevant in the small number of states that still calculate welfare assistance this way), or
  4. a minimum rent your PHA sets — typically somewhere between $0 and $50.

For most working households, the 30%-of-adjusted-income figure ends up being the binding number, which is why it's the one everyone talks about. It's also the figure the Rent Affordability Calculator estimates for you.

Your TTP isn't "what you pay" — it's one side of a two-sided formula

Here's the part that trips people up: your voucher doesn't simply pay "whatever's left" on any unit you choose. The PHA's contribution is capped by its payment standard for your bedroom size — typically 90–110% of the area's Fair Market Rent. How the two numbers interact:

  • If the unit's rent (plus any utilities you're responsible for) is at or below the payment standard, the PHA pays the difference between that amount and your TTP — and you pay exactly your TTP to the landlord.
  • If the unit's rent is above the payment standard, the PHA still only pays up to the standard — so you pay your TTP plus the amount above the standard. Some PHAs cap how high this can push your total housing cost as a share of income, but it's still money out of your pocket that a lower-rent unit wouldn't have cost you.

A worked example

Say your household's adjusted monthly income comes to $1,500. Your TTP is 30% of that: $450. Your area's 2-bedroom payment standard is $1,200.

  • Unit A rents for $1,150 (within the standard). The PHA pays $1,150 − $450 = $700. You pay $450 — exactly your TTP.
  • Unit B rents for $1,300 — $100 over the standard. The PHA still caps its contribution at $1,200 − $450 = $750. You pay $1,300 − $750 = $550: your $450 TTP, plus that extra $100.

Same household, same income, $100/month difference — just from choosing a unit priced above the local payment standard. This is exactly why it's worth checking a unit's rent against your area's payment standard before you sign a lease, not after.

This number isn't permanent

Your TTP gets recalculated at your annual recertification, and sooner if your household reports a change in income or composition mid-year (a new job, a child moving out, a household member becoming disabled). Reporting changes promptly matters — see Your rights & the rules for what you're required to report and when.

Where Fair Market Rent fits into all of this

The payment standard that caps the PHA's side of the equation isn't set arbitrarily — it's a percentage of HUD's Fair Market Rent for your area, republished every fiscal year. FMR is also the number landlords and investors watch closely when deciding whether a market is worth entering, because it effectively sets the ceiling on what a voucher tenant's unit can rent for and still be fully covered. If you're curious how that figure gets set and how it moves over time, Reading Fair Market Rent trends before you buy walks through it from the investor's side — useful context for understanding why your area's payment standard is what it is.

Your TTP is the number that determines what you'll actually owe each month — not the unit's sticker price. Once you have a solid estimate of it, the next useful step is sanity-checking it against the rest of your monthly budget; see What Section 8 actually costs you for the costs a voucher doesn't cover at all.