A change in the 2025 federal budget law is trimming the monthly food benefits of tens of thousands of households by narrowing who automatically qualifies for the utility allowance that raises a SNAP payment. An analysis of the new rules estimates about 29,000 households will lose the full heating-and-cooling allowance, cutting their benefits by roughly $58 a month. Under the change, only a household with a member who is 60 or older or who has a disability is now guaranteed that full allowance; every other household must document its actual utility costs to keep the same benefit it had before.
How the utility allowance shapes a SNAP benefit
SNAP benefits are calculated after subtracting certain deductions from a household’s income, and one of the largest is the shelter deduction, which includes utility costs. Rather than tracking every household’s exact bills, states apply standard utility allowances, fixed dollar figures that stand in for typical heating, cooling and other utility expenses. The largest of these, the heating-and-cooling allowance, can raise a household’s deduction substantially and, in turn, increase the monthly food benefit it receives.
The heating-and-cooling allowance is the most valuable of the standard utility figures because it assumes a household pays separately for heating or air conditioning. Qualifying for it, rather than a smaller utility figure, can be the difference between a modest and a more substantial shelter deduction, which is why the pathway that once made it easy to claim mattered so much to household budgets stretched thin by food and energy costs.
For years, many states let a household qualify for that full allowance automatically if it received even a small payment from the federal Low-Income Home Energy Assistance Program, an approach known as “heat and eat.” The 2025 law changed that link. Now third-party energy-assistance payments preserve automatic access to the full heating-and-cooling allowance only when a household includes a member who is elderly or has a disability; for everyone else, that automatic pathway is gone.
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Who keeps the full allowance and who loses it
The practical result is a split between two groups of recipients. Households with a member 60 or older or with a disability keep the guaranteed full allowance, while other participating households must now provide documentation of their actual heating and cooling costs to claim it. An analysis of the change estimates about 29,000 households will lose the full allowance and see their benefits fall by an average of roughly $58 a month.
States are responsible for setting the standard utility figures and for requiring the new documentation from households that no longer qualify automatically. Because the standard allowances and the mix of affected households vary from state to state, the size of the benefit cut will not be uniform, and some households that fail to submit utility records may lose the deduction even when their real costs would have justified keeping it.
The distinction the law draws is deliberate. By protecting households with an elderly or disabled member, the change preserves the larger benefit for groups that tend to have higher and less flexible utility bills, while shifting a paperwork burden onto younger, non-disabled households that previously cleared the bar with a nominal energy-assistance payment.
Why it matters for older Americans on fixed incomes
For retirees living on a set monthly income, the carve-out matters. A household where at least one person is 60 or older continues to receive the full heating-and-cooling allowance automatically, which helps protect the food benefit at a time when electricity and heating costs have been climbing. A benefit cut of about $58 a month would amount to roughly $700 over a year, a meaningful sum for a household already stretching a fixed check.
The change also affects mixed households, such as an older adult living with adult children or grandchildren. Whether the household qualifies automatically turns on having a member who is elderly or disabled, so the presence of an older relative can determine whether the full allowance applies to everyone under the same roof. That makes it worth confirming how a state is applying the rule before assuming a benefit will stay the same.
Advocates for low-income households have warned that even families who would still qualify based on their real expenses could lose the benefit if they do not respond to a state’s request for documentation. For older Americans helping relatives navigate the system, keeping utility bills and responding promptly to state notices becomes a practical way to avoid an unnecessary cut.
What is not yet clear is how many of the households losing automatic eligibility will manage to document their utility costs and keep the deduction, and how many will simply see a smaller benefit because the paperwork never gets filed. The eventual size of the cut depends less on the law’s text than on how states carry it out and how many affected households navigate the new requirement in time.
This article was researched and drafted with the assistance of AI and reviewed by The Money Overview editorial team.
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