US Welfare System — Overview

The US social safety net is built in three layers: federal, state and employer. Social Security (retirement, disability, survivors) and Medicare are federal social insurance funded by payroll tax (FICA). Unemployment insurance, Medicaid, K–12 schools and paid family leave are run by the states, so rules and amounts differ from state to state. Health insurance and retirement savings (401(k)) usually come through the employer. Losing a job therefore often means losing health coverage too. Most means-tested help (SNAP, Medicaid, housing vouchers, TANF) depends on income and on immigration status.

Who is covered

• Workers on any status pay FICA and earn Social Security credits, unless exempt (for example F-1 students in their first years, see the pension page).
• Green-card holders (LPRs) can use most federal programs, but usually only after a 5-year waiting period for Medicaid, SNAP and TANF.
• Since the 2025 budget law (P.L. 119-21), several programs are limited to citizens, LPRs, Cuban/Haitian entrants and COFA migrants: SNAP (already in force), full federal Medicaid and CHIP (from 1 October 2026) and Marketplace subsidies (from 1 January 2027). Refugees and asylees lose access unless they become LPRs.
• Temporary visa holders (F-1, H-1B, L-1 and others) rely on employer or private insurance and cannot use most means-tested programs.

First registrations for newcomers

• Social Security number (SSN) from the SSA, needed for work, taxes and most benefits. Without work authorisation you may need an ITIN from the IRS for tax filing.
• State ID or driver's licence; since May 2025 domestic flights need a REAL ID-compliant card or a passport.
• Health insurance from day one: employer plan, the Marketplace (special enrolment within 60 days of moving or losing coverage) or Medicaid if eligible.
• Change of address: most non-citizens must report a move to USCIS within 10 days (Form AR-11).

The areas at a glance

• Health (health) — employer plans, the ACA Marketplace, Medicaid and Medicare (65+); no universal public insurance.
• Pension (pension) — Social Security (40 credits; full retirement age 67 for those born 1960 or later) plus 401(k) and IRA savings.
• Unemployment (unemployment) — state-run benefit, usually up to 26 weeks; afterwards only means-tested help such as SNAP or TANF.
• Family (family) — Child Tax Credit up to USD 2,200 per child (2026), EITC, SNAP, WIC, Trump Accounts for children born 2025–2028.
• Tax (tax) — progressive federal income tax (10–37%), state and local income tax, citizenship-based worldwide taxation.
• Housing (housing) — market rents, Section 8 vouchers with long waiting lists, FHA mortgages (LPRs and citizens only since 2025).
• Education (education) — free public K–12 regardless of status; expensive college; FAFSA for citizens and eligible non-citizens.
• Parental (parental) — 12 weeks unpaid FMLA; paid leave only in some states or from employers.

Things to watch

• Benefit rules for immigrants changed a lot in 2025–2026 and court cases continue; check the agency page before you apply.
• USCIS applies new public charge guidance from 18 September 2026 (the 2022 rule was rescinded). If you or a relative still need a green card or visa, check it before using benefits.
• All amounts here are 2026 figures and are adjusted yearly.

Official guidance: USA.gov: Benefits, Social Security Administration, HealthCare.gov: Immigrants, USCIS Policy Manual: Public charge

US Health Insurance

The US has no single public health insurance for everyone. Most working-age people are covered through an employer; others buy a plan on the ACA Marketplace; low-income residents may get Medicaid (run by each state); people aged 65+ get Medicare. Costs for the same treatment can vary widely with your plan, so sorting out insurance is one of the first things to do after arrival.

Main pathways

• Employer plans: the employer chooses the insurer and pays part of the premium. After a job loss, COBRA lets you keep the plan (employers with 20+ staff) for a limited time, but you may pay up to 102% of the full cost.
• ACA Marketplace (HealthCare.gov or your state exchange): open enrolment for 2027 coverage runs 1 November 2026 – 15 January 2027; outside it you need a Special Enrollment Period, for example within 60 days of losing coverage, moving or having a baby. Households with income between 100% and 400% of the federal poverty level can get a premium tax credit (2026).
• Medicaid and CHIP: state-run, free or low-cost. Most green-card holders wait 5 years; some states waive the wait for children and pregnant women. From 1 October 2026, full federal Medicaid/CHIP is limited to citizens, LPRs, Cuban/Haitian entrants and COFA migrants; emergency Medicaid remains.
• Medicare: sign up in the 7-month window around your 65th birthday. Part A (hospital) is premium-free with 40 work credits; the standard Part B premium is USD 202.90/month and the deductible USD 283 (2026; adjusted yearly). Late sign-up can mean lifelong penalties.

Key terms

• Premium: monthly price of the plan.
• Deductible: what you pay before the plan starts paying.
• Copay / coinsurance: your fixed fee or percentage per service.
• Out-of-pocket maximum: Marketplace plans cap your yearly costs at USD 10,600 for one person and USD 21,200 for a family (2026; USD 12,000 / 24,000 in 2027).
• In-network vs out-of-network: providers outside your plan's network may be covered poorly or not at all, except in emergencies.

Immigrants and eligibility changes

• Lawfully present immigrants (including many visa holders) can buy Marketplace plans. From 1 January 2027, only LPRs, Cuban/Haitian entrants and COFA migrants qualify for Marketplace subsidies.
• From 4 January 2027, Medicare is limited to citizens, LPRs, Cuban/Haitian entrants and COFA migrants; other non-citizen enrollees lose coverage.
• The No Surprises Act protects you from most surprise out-of-network bills for emergency care and for some services at in-network hospitals.

Common pitfalls for newcomers

• Going without insurance: emergency rooms must treat you, but the bill still comes later.
• Missing the open-enrolment deadline or the 60-day special enrolment window after a job change.
• Checking only the premium and ignoring the deductible and network.
• Students should check whether their school requires its own plan.

Official guidance: HealthCare.gov, HealthCare.gov: Coverage for immigrants, Medicare.gov, Medicaid.gov, CMS: No Surprises

US Retirement System

US retirement is often described as a three-legged stool: the federal Social Security pension, an employer plan such as a 401(k), and personal savings in an IRA. Social Security alone rarely replaces a middle-class income, so most workers also save through the other two.

Social Security (SSA)

• Run by the Social Security Administration and funded by payroll tax (FICA): 6.2% from the employee and 6.2% from the employer on earnings up to USD 184,500 (2026; adjusted yearly). Self-employed people pay both shares. Medicare tax (1.45% each) comes on top, with no cap.
• You need 40 credits (about 10 years of work) for a retirement pension. In 2026 one credit is earned for every USD 1,890 of earnings, up to 4 credits a year.
• Full retirement age is 67 for people born in 1960 or later. You can start at 62 with a reduction of about 30%; waiting beyond 67 up to 70 increases the pension.
• Average retired-worker benefit: USD 2,071/month; maximum at full retirement age USD 4,152/month (January 2026, after a 2.8% cost-of-living increase).
• The Social Security Fairness Act (January 2025) repealed the WEP and GPO rules that used to cut benefits for people who also receive a pension from work not covered by Social Security.

401(k) and IRA

• 401(k): employer plan with pre-tax or Roth contributions from your pay. The 2026 limit is USD 24,500, plus USD 8,000 catch-up from age 50 (USD 11,250 at ages 60–63). Many employers add a match; contribute at least enough to get it.
• IRA: personal account, traditional (tax-deferred) or Roth (tax-free withdrawals). The 2026 limit is USD 7,500, plus USD 1,100 from age 50. Roth contributions phase out between USD 153,000 and 168,000 of income for single filers (2026).
• Withdrawals before age 59½ usually cost a 10% penalty plus income tax. When you change jobs you can roll a 401(k) into an IRA.

Agreements with other countries and living abroad

The US has social security (totalization) agreements with 31 countries, including Canada, Japan, Australia, Brazil, Chile, South Korea and many EU countries (the newest, with Romania, from 1 September 2026). They prevent double contributions for posted workers and let you combine work periods to qualify for a pension; each country then pays only for its own periods. If your country is not on the SSA list, US credits and foreign credits cannot be combined.

US citizens can generally receive Social Security anywhere. Non-citizens usually lose payments after six full calendar months outside the US unless an exception applies, for example through an agreement country; check the SSA screening tool before moving.

Common pitfalls for newcomers

• Leaving the US with fewer than 40 credits and no agreement country to combine them with: there is no refund of US contributions.
• Not checking your earnings record each year in a my Social Security account.
• F-1, J-1 and M-1 students and scholars who are nonresident aliens are exempt from FICA on authorised work; once they become tax residents or change status, FICA applies.
• Cashing out a 401(k) when leaving a job instead of rolling it over.

Official guidance: SSA: Retirement benefits, SSA: International agreements, SSA: Payments abroad, IRS: Retirement plans

US Unemployment Insurance

US unemployment insurance (UI) is a joint federal–state program: federal law sets the framework, but each state runs its own scheme and decides who qualifies, how much is paid and for how long. You apply to the UI agency of the state where you worked. The benefit is funded mainly by employer payroll taxes (federal FUTA and state taxes); employees pay nothing in most states.

Who qualifies

• You must be unemployed through no fault of your own: in most states that means losing your job because there was no work (a layoff). Quitting without good cause or being fired for misconduct usually leads to a denial; states differ on what counts as good cause.
• You must have earned enough wages or worked enough during the base period, in most states the first four of the last five completed calendar quarters.
• Each week you must be able to work, available for work and actively looking, and report any earnings and job offers.
• Non-citizens: federal law allows benefits only for work done while you were a permanent resident or lawfully present and authorised to work, and you must still be authorised to work while you claim.

Amount, duration and how to apply

• The weekly benefit is generally a percentage of your earnings over a recent 52-week period, up to a state maximum that differs widely between states.
• Benefits are paid for up to 26 weeks in most states; some states pay for fewer weeks. Extra weeks (Extended Benefits) exist only when state unemployment is very high. The COVID-era federal top-ups have ended.
• Apply as soon as you lose your job, usually online. Have your SSN, your employers' names and addresses, dates of work and the reason for separation ready. The first payment usually arrives 2–3 weeks after you file; some states have a one-week waiting period.
• After that you file weekly or biweekly claims.

Tax and what comes after

• UI benefits are taxable federal income and taxable in most states. You receive Form 1099-G; you can ask for federal tax to be withheld with Form W-4V.
• When benefits run out there is no general federal cash assistance. Low-income households may turn to SNAP (food), state TANF cash aid for families with children, Medicaid, or local help through 211; eligibility depends on income and immigration status.

Common pitfalls for newcomers

• Work visas: H-1B and similar workers often have a limited grace period after a layoff, and benefits stop as soon as work authorisation ends.
• Severance or vacation pay can delay or reduce benefits in some states; report it honestly.
• Not reporting part-time earnings in weekly claims is treated as fraud: repayment, penalties and possible prosecution.
• Identity thieves file fake claims: if you get a 1099-G for benefits you never claimed, tell the state agency.

Official guidance: US Department of Labor: Unemployment insurance, CareerOneStop: Find your state UI office, IRS: Unemployment compensation

US Family Support

The US has no universal monthly child allowance. Most federal help for families comes through tax credits claimed on the yearly tax return, plus income-tested food and cash programs run by the states. Filing taxes correctly, with valid numbers for every family member, is therefore the key to getting support.

Tax credits and children's accounts

• Child Tax Credit (CTC): up to USD 2,200 per child under 17 (2026). If you owe little tax, up to USD 1,700 per child can be paid out as the Additional Child Tax Credit (needs at least USD 2,500 earned income). The full credit applies up to USD 200,000 of income (USD 400,000 for joint filers). Each child and you (or your spouse, if filing jointly) need an SSN valid for work, issued before the return's due date; an ITIN is not enough. Dependents who do not qualify may give a USD 500 credit.
• Earned Income Tax Credit (EITC): a refundable credit for low- and moderate-income workers, up to USD 8,231 with three or more children (2026); smaller amounts with fewer or no children.
• Child and Dependent Care Credit and employer Dependent Care FSAs (up to USD 7,500 a year tax-free from 2026) help with daycare costs.
• Trump Accounts: children born 2025–2028 who are US citizens with an SSN can get a one-time USD 1,000 federal deposit into an investment account; parents elect it with Form 4547 or in their IRS online account.

Food and cash assistance

• SNAP (food benefits on an EBT card): for low-income households. Since the 2025 law, the only eligible non-citizens are LPRs (usually after 5 years), Cuban/Haitian entrants and COFA citizens; refugees and asylees no longer qualify by that status alone. US-citizen children in a household can still be eligible.
• WIC: food, nutrition advice and breastfeeding support for pregnant women, mothers up to 6 months after birth (12 months if breastfeeding) and children under 5, with income up to 185% of the poverty guidelines and nutritional risk.
• TANF: state cash aid for low-income families with children, with work requirements and a federal 60-month lifetime limit. Most qualified immigrants face a 5-year wait.

Childcare

• The federal Child Care and Development Fund (CCDF) helps low-income working parents pay for childcare through state programs; waiting lists are common.
• Some states and cities offer free or low-cost pre-kindergarten. Private childcare is expensive.

Common pitfalls for newcomers

• Parents with only an ITIN cannot claim the CTC (from 2025 at least one parent needs a work-valid SSN), even when the child has an SSN.
• Not filing a tax return because income was low: refundable credits are only paid if you file.
• Using benefits without checking the immigration rules: if a relative still needs a green card, check the USCIS public charge guidance first.
• Children born in the US are citizens and get an SSN; apply for it at birth registration in the hospital.

Official guidance: IRS: Child Tax Credit, IRS: EITC, IRS: Trump Accounts, USDA: SNAP, USDA: WIC

US Taxes

The US taxes income at federal, state and sometimes city level. A non-citizen is a tax resident if they hold a green card or meet the substantial presence test (days spent in the US); residents are taxed on their worldwide income. US citizens stay taxable on worldwide income even when they live abroad (citizenship-based taxation). Payroll taxes for Social Security and Medicare (FICA, 7.65% for employees) are withheld separately.

Federal income tax 2026

Rates for single filers on taxable income (2026; adjusted yearly; joint filers have higher thresholds):

• 10% up to USD 12,400; 12% up to USD 50,400; 22% up to USD 105,700; 24% up to USD 201,775
• 32% up to USD 256,225; 35% up to USD 640,600; 37% above

The standard deduction is USD 16,100 (single) or USD 32,200 (married filing jointly) for 2026. Itemising helps only if mortgage interest, state and local taxes (SALT, capped at USD 40,400 for 2026, lower for very high incomes) and donations are larger. New deductions from the 2025 law cover some tips, overtime pay and people aged 65+.

Filing

• Returns for 2026 are due 15 April 2027 (Form 1040). An extension to 15 October gives more time to file, not to pay.
• US citizens and residents living abroad get an automatic extension to 15 June.
• Most states have their own income tax return; a few, such as Texas and Florida, have no personal income tax. Some cities (for example New York City) add a local income tax. Property tax and sales tax are set locally.

Foreign income and accounts

• Report worldwide income. Tax paid abroad can usually be credited (Foreign Tax Credit, Form 1116); people living abroad may instead exclude up to USD 132,900 of foreign earned income (2026, Form 2555).
• FBAR (FinCEN 114): required if your foreign accounts together exceed USD 10,000 at any time in the year; due 15 April with an automatic extension to 15 October. Penalties can be severe.
• Form 8938 (FATCA): required above USD 50,000 at year-end or USD 75,000 at any time for single filers living in the US (higher thresholds for joint filers and people abroad).
• Foreign mutual funds are usually treated as PFICs, with complex reporting on Form 8621.
• The US has income tax treaties with many countries that can reduce double taxation.

Common pitfalls for newcomers

• Not knowing you became a tax resident: a green card or enough days in the US makes your worldwide income taxable.
• Forgetting FBAR or Form 8938 for home-country bank, pension and investment accounts.
• Assuming tax paid at home settles everything: you must still file a US return and claim the credit.
• Giving up a green card or citizenship can trigger an exit tax for long-term residents with large assets (Form 8854).

Official guidance: IRS: Tax residency, IRS: 2026 inflation adjustments, IRS: FBAR, IRS: Tax treaties

US Housing

US housing is largely market-driven. Rents and tenant rules are set by states and cities, and public help is mostly means-tested rent subsidies with long waiting lists. Social housing exists in some big cities, but the stock is small compared with demand. Most newcomers rent privately first.

Renting

• Landlords usually check credit history, income and references. Without a US credit record, expect to be asked for a larger deposit, a co-signer (guarantor) or proof of savings. If you have no SSN yet, ask whether an ITIN or passport is accepted.
• Security deposits: limits and the deadline for returning them depend on state law. Do a move-in inspection with photos and keep copies.
• The Fair Housing Act bans discrimination based on race, colour, national origin, religion, sex, disability or family status. Complaints go to HUD.

Housing Choice Vouchers (Section 8) and public housing

• Vouchers are run by local Public Housing Agencies (PHAs) with federal money from HUD. Income must generally be at or below 50% of the area median income, and 75% of vouchers go to households at or below 30%.
• The household usually pays about 30% of its adjusted income in rent; the voucher pays the landlord the rest up to a local limit.
• Public housing is owned by PHAs, with rent also based on income and a separate waiting list. Lists are often closed or years long.
• Status rules: assistance is for citizens and eligible non-citizens (such as LPRs, refugees and asylees); temporary visa holders such as students do not qualify. In mixed-status families aid is currently reduced in proportion; HUD proposed in February 2026 to end this proration, so ask your PHA about current rules.
• LIHTC buildings, financed with tax credits, offer below-market rents to lower-income tenants; rules vary by property.

Buying a home

• FHA loans: down payment from 3.5% with a credit score of 580 or more (10% for scores from 500 to 579). Mortgage insurance is required. For 2026 the one-unit loan limit ranges from USD 541,287 to USD 1,249,125 depending on the county.
• Since 25 May 2025, FHA loans are available only to US citizens and LPRs; non-permanent residents (for example H-1B holders, DACA recipients) must use conventional or other lenders.
• Many states run first-time buyer programs with down-payment help.

Common pitfalls for newcomers

• Signing a lease without reading the renewal, early-termination and deposit clauses.
• Paying a "deposit" to secure a flat you have not seen: rental scams are common online.
• Assuming you can get a voucher quickly: waiting lists can be closed for years.
• For emergencies such as eviction or homelessness, call 211 for local help.

Official guidance: HUD: Housing Choice Vouchers, HUD: Fair housing, CFPB: Buying a house, 211

US Education

US education combines free public schooling from kindergarten to grade 12 (K–12) with expensive higher education. Schools are run by states and local school districts and funded largely by local property taxes, so quality varies a lot between districts. Colleges charge tuition, and federal student aid is the main way families pay for it.

K–12 schools

• Public schools are tuition-free for children living in the district. Under the Supreme Court decision Plyler v. Doe (1982), children cannot be denied a free public education because of their or their parents' immigration status.
• Compulsory school ages are set by each state; schooling usually runs from about age 5–6 to 16–18. Enrol through your local school district with proof of address and the child's age; schools may ask for vaccination records.
• English learner (EL/ESL) support must be provided to children who need it.
• Free or reduced-price school meals depend on household income.
• Alternatives: charter schools and magnet schools (public, free, often by lottery), private schools (fee-paying) and homeschooling (rules vary by state).

Higher education

• Community colleges (2-year) are the cheapest route; public universities charge much lower in-state tuition to state residents (usually after about a year of residence, by state rules); private universities cost the most. Compare real costs on the College Scorecard.
• Students on F-1 visas are generally charged out-of-state or international rates.
• After graduation, F-1 students can work on OPT for up to 12 months, plus 24 months for STEM degrees.

Federal student aid (FAFSA)

• The FAFSA (Free Application for Federal Student Aid) gives access to federal grants, loans and work-study, and is used by many states and colleges. The 2027–28 FAFSA has been open since September 2026; file early each year.
• Only US citizens and eligible non-citizens (for example LPRs, refugees and asylees) can get federal aid. Temporary visa holders and DACA recipients cannot, though some states offer their own aid.
• Pell Grant: up to USD 7,395 for 2026–27 for undergraduates with financial need; it does not have to be repaid.
• Direct Loans: subsidised and unsubsidised loans for students. Since 1 July 2026, for new borrowers, Grad PLUS loans have ended, graduate borrowing is capped at USD 20,500 a year (USD 50,000 for professional degrees), and Parent PLUS loans are capped at USD 20,000 a year and USD 65,000 in total per student. A new Repayment Assistance Plan (RAP) links repayments to income; Public Service Loan Forgiveness continues.

Common pitfalls for newcomers

• Choosing a home only on price: the school district determines which public school your child attends.
• Assuming a US-citizen child automatically gets in-state tuition: residency for tuition depends on where the family has lived, not on citizenship.
• Missing state and college aid deadlines, which can be earlier than the federal one.
• Taking private loans before using federal grants and loans.

Official guidance: StudentAid.gov, FAFSA, College Scorecard, US Department of Education

US Maternity, Paternity and Parental Leave

The US has no federal law guaranteeing paid parental leave for private-sector workers. New parents usually combine three things: unpaid, job-protected leave under the federal FMLA, a state paid-leave program where one exists, and their employer's own policy. What you get therefore depends heavily on where you live and who you work for.

Federal FMLA: 12 weeks unpaid

• The Family and Medical Leave Act gives eligible employees up to 12 workweeks of unpaid, job-protected leave in a 12-month period for the birth of a child, adoption or foster placement (within one year), a serious health condition of their own, or care for a seriously ill spouse, child or parent.
• Your group health insurance continues on the same terms during leave, and you return to the same or an equivalent job.
• Eligibility: the employer has 50 or more employees within 75 miles, and you have worked there at least 12 months and 1,250 hours in the past year. Many small-business and new employees are not covered.
• Both parents can use FMLA; bonding leave can be taken in blocks or intermittently if the employer agrees.

State paid family and medical leave

• 13 states and the District of Columbia have paid family and medical leave laws: California, Colorado, Connecticut, Delaware, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Oregon, Rhode Island and Washington. Benefits started in Delaware and Minnesota in January 2026 and in Maine in May 2026; Maryland's benefits start in January 2028.
• Programs are funded by payroll contributions and usually pay a share of your wages, up to a weekly maximum, for around 12 weeks of family leave; amounts and conditions differ by state.
• Temporary disability insurance for pregnancy and childbirth recovery exists in Hawaii and Puerto Rico and as part of some state programs; New Hampshire, Vermont and Virginia have voluntary leave insurance.
• Many employers, especially larger ones, offer paid parental leave or short-term disability insurance that pays part of your salary after childbirth. Check your benefits package before the birth.

Protections at work and health cover

• The Pregnant Workers Fairness Act (in force since 27 June 2023) requires employers with 15 or more employees to provide reasonable accommodations for pregnancy, childbirth and related conditions, such as breaks, schedule changes or time off.
• The federal PUMP Act gives most nursing employees break time and a private space (not a bathroom) to express milk for one year after birth.
• Medicaid covers pregnancy and childbirth for eligible low-income women, with coverage continuing after the birth for a period set by the state. Having a baby opens a 60-day Marketplace special enrolment period.

Common pitfalls for newcomers

• Assuming leave is paid: FMLA is unpaid, so check state and employer benefits early.
• Starting a new job late in pregnancy: you may not yet meet the 12-month and 1,250-hour FMLA test or your state's earnings test.
• Forgetting to add the baby to your health plan within the plan's deadline, which can be short.
• Visa holders: leave does not change your status, but a job loss during or after leave can.

Official guidance: US Department of Labor: FMLA, DOL Women's Bureau: Paid leave, EEOC: Pregnant Workers Fairness Act, DOL: PUMP Act