IRS Form 433-F Allowable Expenses: National and Local Standards

The IRS 433-F allowable expenses fall into two buckets: fixed monthly allowances published as the Collection Financial Standards, and a shorter list of necessary expenses the IRS reviews at your actual cost. For the standards, the IRS allows either the published amount or what you actually spend, whichever is lower.¹ Anything you spend above the standard is treated as money available to pay your tax debt. A single person, for example, is allowed $839 per month for food, clothing, and personal items regardless of what they actually spend on those categories.²

The figures below come from the standards published on April 21, 2025, which remain in effect until June 2026.³

National Standards: Food, Clothing, and Personal Care

This standard covers five categories of everyday spending bundled together: food, housekeeping supplies, clothing, personal care products, and a miscellaneous catch-all. You receive the full amount based on household size without proving what you actually spent.²

One person: $839 per month
Two persons: $1,481 per month
Three persons: $1,753 per month
Four persons: $2,129 per month
Each additional person beyond four: add $394

Household size generally matches the number of dependents on your most recent tax return. The miscellaneous portion — $154 of the single-person amount — covers expenses that don’t fit anywhere else, including credit card payments, bank fees, school supplies, and any category where your spending runs over its share of the standard.²

National Standards: Out-of-Pocket Health Care

The IRS sets a separate per-person monthly allowance for medical costs you pay out of pocket, including prescription drugs, medical supplies, and eyeglasses. This is on top of whatever you pay for health insurance premiums.⁴

Under 65: $84 per person per month
65 and older: $149 per person per month

You get this amount automatically for each person in the household. If your actual out-of-pocket costs exceed the standard, the IRS will consider the higher amount, but you’ll need documentation: pharmacy receipts, medical bills, or provider statements. Elective procedures like cosmetic surgery don’t count.⁴

Local Standards: Housing and Utilities

Housing is usually the largest number on Form 433-F. The local standard covers rent or mortgage, property taxes, homeowner’s insurance, maintenance, and basic utilities. The IRS publishes a different allowance for every county in every state, broken into five household-size tiers: one person, two, three, four, and five or more.⁵

Variation across counties is significant. A single person in a rural Alabama county might see a housing standard around $1,336, while a family of four in a coastal California county could have an allowance above $5,000. Look up your county on the IRS website under “Local Standards: Housing and Utilities.” If your actual housing cost is below the standard, the IRS uses your real number. If it runs over, the IRS treats the excess as cash available for tax debt.

Local Standards: Transportation

Transportation splits into two pieces, and you complete both on Form 433-F.

Ownership Costs

The ownership allowance covers monthly loan or lease payments and is set nationally, regardless of where you live: $662 per month for one vehicle, $1,324 for two.⁶ If you own the car outright with no loan or lease, your ownership allowance is zero. The IRS won’t credit a payment you aren’t making.

Operating Costs

Operating costs cover fuel, maintenance, repairs, insurance, registration, parking, and tolls. These vary by region and metropolitan area. Personal property taxes on vehicles are not included in the operating standard. If you have a vehicle, you receive the operating allowance for your region whether or not you also have an ownership payment.⁶

Other Necessary Expenses Allowed at Actual Cost

Beyond the standards, the IRS recognizes a category of expenses reviewed at their real dollar amount. These are costs considered necessary for your health, welfare, or ability to earn income, and each one has to be documented and reasonable.⁷

Health insurance premiums, allowed at the actual amount you pay, separate from the out-of-pocket health care standard.
Current-year taxes: federal income tax, FICA, Medicare, and state and local taxes, allowed even if you failed to pay them in prior years.
Court-ordered child support and alimony, allowed as long as the order is current and you’re actually making the payments. Stop paying, and the IRS will stop allowing the expense.
Job-related costs like union dues, required uniforms, and specialized tools that are a condition of your employment.
Dependent care for a child or an elderly or disabled family member, when there’s no alternative to the taxpayer paying.

Expect the IRS to ask for proof: pay stubs showing withholding, court orders, childcare invoices, or an employer letter verifying mandatory costs.

Conditional Expenses and the Six-Year Rule

Some expenses that don’t clear the necessary-expense bar can still be allowed depending on your repayment timeline. These conditional expenses include student loan payments, credit card minimum payments, and voluntary retirement contributions. The IRS generally permits them only when your full tax liability, including projected interest, can be paid within six years and before the collection statute expiration date.⁸

Under the six-year rule, you still submit full financial information, but the IRS doesn’t require line-by-line substantiation of every expense. All reasonable expenses are allowed as long as the math works for full repayment within the six-year window. The rule applies only to individual taxpayers. Corporations, partnerships, and LLCs don’t get it.⁸

If your tax debt is too large to be paid within six years even after stripping conditional expenses out, the IRS will disallow those expenses and redirect that money to your monthly payment. Losing the ability to make student loan or retirement contributions is where many taxpayers feel the squeeze.

How the IRS Compares Your Spending to the Standards

For the National Standards on food, clothing, and out-of-pocket health care, you get the full published amount automatically. You don’t have to spend it to claim it, and you don’t have to prove what you spent.

For the Local Standards on housing and transportation, the IRS applies a “lower of” rule: the smaller of your actual monthly cost or the published cap for your county. Spending below the cap gives you your real number. Spending above the cap loses the overage — that difference goes onto the ledger as disposable income available to pay the IRS.

A quick example. If the housing standard for your county and household size is $1,800 and your rent is $1,200, the IRS allows $1,200. If your rent is $2,200, the IRS allows $1,800 and treats the extra $400 as available for tax payments.

Requesting a Deviation from the Standards

The published standards are guidelines, not absolute ceilings. When a standard amount is genuinely inadequate for a taxpayer’s basic needs, the IRS can allow a higher figure. You have to show that applying the standard would cause economic hardship, and you need documentation to back it up.¹

Situations where deviations tend to succeed include ongoing medical costs that far exceed the out-of-pocket health standard, specialized transportation needs tied to a disability, and housing costs in high-cost areas where relocating isn’t realistic. The justification has to be necessity rather than preference. The IRS won’t approve a deviation because you like your neighborhood or drive a nicer car than you strictly need. Bring medical bills, utility statements, or an employer letter explaining why the standard falls short.

Why Accuracy on the Form Matters

The IRS can terminate an installment agreement if it later finds that the financial information you provided was inaccurate or incomplete.⁹¹⁰¹¹¹² Report your expenses at the real numbers, keep the documentation, and take the standard where it applies.

1
Internal Revenue Service. 5.15.1 Financial Analysis Handbook
2
Internal Revenue Service. National Standards: Food, Clothing and Other Items
3
Internal Revenue Service. Collection Financial Standards
4
Internal Revenue Service. National Standards: Out-of-Pocket Health Care
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Internal Revenue Service. Local Standards: Housing and Utilities
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Internal Revenue Service. Local Standards: Transportation
7
Internal Revenue Service. 5.15.1 Financial Analysis Handbook – Section: 5.15.1.11 Other Expenses
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Internal Revenue Service. 5.14.1 Securing Installment Agreements
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Office of the Law Revision Counsel. 26 U.S. Code 6159 – Agreements for Payment of Tax Liability in Installments
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Internal Revenue Service. Defaulted Installment Agreements, Terminated Agreements and Appeals
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Office of the Law Revision Counsel. 26 U.S. Code 7201 – Attempt to Evade or Defeat Tax
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Office of the Law Revision Counsel. 26 U.S. Code 7206 – Fraud and False Statements