IRS Allowable Living Expenses Calculator

When you ask for a payment plan over $50,000, an Offer in Compromise or hardship status, the IRS reviews a Collection Information Statement — Form 433-F, 433-A or 433-A (OIC). It subtracts allowable expenses from your income, and the remainder is what it expects you to pay each month. Allowable expenses are not the same as your actual bills: most categories are capped by the IRS Collection Financial Standards.

This worksheet uses the standards effective 2026-06-29. National Standards and health care amounts are allowed in full without receipts. Housing and transportation are allowed at the lesser of what you actually pay or the standard.

• National Standards cover food, housekeeping supplies, apparel, personal care and a miscellaneous allowance, by household size. The household size should generally match the dependents on your latest return.
• Out-of-pocket health care is a per-person amount that's in addition to health insurance premiums.
• Housing and utilities standards are set county by county and include mortgage or rent, property taxes, insurance, maintenance and utilities.
• Transportation includes an ownership allowance (your car payment, up to the standard, for up to two vehicles) and operating costs by region. If you have no car, you get the public transportation allowance instead.
• Other necessary expenses — current income taxes, health insurance, court-ordered payments, child care needed to work — are generally allowed at actual cost when documented.

Subtract the total from your gross monthly household income. If little or nothing is left, run the Currently Not Collectible screener. If there's a positive amount, that figure times 12 or 24 months feeds into an Offer in Compromise estimate, and it's the payment the IRS may ask for on a non-streamlined plan.