A household on the Supplemental Nutrition Assistance Program that pays $70 a month for home internet used to be able to fold part of that bill into the deduction that lowers countable income and raises a monthly benefit. A provision buried inside the 2025 federal law known as the One Big Beautiful Bill Act erased that option entirely, barring internet costs from the shelter deduction and from the utility allowances that feed into it. The change already took effect, and it lands the same season the maximum shelter deduction itself rises for the first time this fiscal year.
The Line USDA Told States To Remove
The U.S. Department of Agriculture’s Food and Nutrition Service spelled out the change in a September 2025 information memorandum sent to every state SNAP agency, signed by Acting Associate Administrator Ronald Ward. Section 10104 “prohibits inclusion of internet costs in a household’s allowable shelter costs for the purposes of the excess shelter deduction,” according to the memo, and it extends the same restriction to the standard utility allowances many states use as a shortcut instead of itemizing individual bills. The provision took effect immediately when President Trump signed the underlying law, Public Law 119-21, on July 4, 2025.
The Food and Nutrition Service told states to recalculate their fiscal year 2026 standard utility allowance values by August 15, 2025, stripping the internet line out of the formula agencies use to estimate a household’s home energy and utility costs without demanding individual bills. A household that once folded a broadband bill into that shelter math now gets nothing for it, no matter how essential the connection is for job searches, telehealth appointments or a child’s remote schoolwork.
What ends coverage most often: Not ineligibility, but a renewal packet returned late or missing one document. See the renewal document checklist in The SNAP & Medicaid Renewal Organizer.
How The $769 Cap Changes The Math
The timing compounds the loss. USDA’s fiscal year 2027 cost-of-living adjustment memo, dated August 21, 2026, raises the maximum excess shelter deduction to $769 a month for the 48 contiguous states and D.C., effective October 1, 2026. That ceiling matters because a household’s shelter deduction is the amount by which its housing and utility costs exceed half its net income, capped at that figure unless someone in the household is elderly or disabled. Removing internet costs from the expenses that count toward that calculation means more households will land further below the cap, seeing less credit for housing costs that, for many, keep climbing anyway.
For a renter already paying close to the cap in rent and standard utility charges, losing the ability to add even $20 or $30 of an internet bill can shave a few dollars off a monthly SNAP allotment — small on paper, but real for a household that budgets month to month.
Utility Allowances Absorb The Same Cut
Roughly a third of SNAP households don’t itemize actual utility bills; instead, their state agency assigns a standard utility allowance based on regional averages, adjusted annually. Section 10104’s restriction on those allowances meant every state had to strip internet costs out of the formula used to build them, a technical change that touches millions of cases without any household needing to file new paperwork. USDA’s memo left the mechanics of recalculating each state’s allowance to the states themselves, providing implementation instructions rather than a single national number.
Why The Law Draws The Line At Internet
The provision sits alongside several other SNAP changes made by the same law, laid out on USDA’s One Big Beautiful Bill Act implementation page, including a revised approach to updating the Thrifty Food Plan and new limits on state waivers of work requirements. Internet service, unlike a heating bill or rent, was treated by the drafters as outside the category of shelter necessities the deduction was built to offset, though USDA’s guidance does not explain the policy reasoning beyond citing the statutory text itself. What the guidance makes clear is that the restriction is not temporary and carries no phase-in: it applied “upon enactment,” and state agencies have already been operating under it for more than a year.
Other Changes Arrive With The Same Memo
The August 21, 2026 COLA memo raises more than the shelter cap. The standard deduction every SNAP household subtracts from gross income before benefits are calculated rises to $217 a month for households of one to three people in the 48 states and D.C., climbing to $308 for households of six or more. The minimum monthly benefit for a household of one or two people increases to $25, and the homeless shelter deduction — a smaller, separate deduction for households without a fixed address — rises to $205.66. The asset limit for most households stays at $3,000, while households with a member who is 60 or older or disabled see their limit rise to $4,750.
None of those adjustments touch the internet restriction directly, but they arrive in the same memo and take effect the same day, October 1, 2026, so a household’s benefit letter this fall is likely to reflect several changes at once rather than a single line item.
When The Shelter Deduction Changes, Recertification Follows
A shelter deduction recalculated under the new rule does not appear on its own — it shows up the next time a household’s SNAP case is reviewed, whether that is a routine annual recertification or a change reported in between. Caseworkers apply the updated utility allowance and shelter cap using whatever documentation the household has most recently filed, so an outdated bill or a missed renewal form can leave the wrong figures in place for months.
The SNAP & Medicaid Renewal Organizer is a 13-page organizer with 51 state packs and a renewal document checklist for tracking exactly which shelter and utility figures a household’s next renewal needs.
Compare the renewal and reporting calendar in The SNAP & Medicaid Renewal Organizer.
This article was produced with AI assistance and reviewed by a human editor. Figures are linked to their primary sources.
