The Housing and Utilities Standard: Why Your County Matters

Housing is usually the largest expense on a collection information statement, and it is the one most likely to be cut. The IRS does not care what your mortgage is. It cares what its county table says a household your size should need. When your rent is above that number, the gap becomes "disposable income" on paper, even though it is going to your landlord in real life.

What the standard covers

IRM 5.15.1.10.1 defines housing expenses as mortgage (including interest) or rent, property taxes, necessary maintenance and repair, homeowner's or renter's insurance, homeowner dues and condominium fees.

Utilities include gas, electricity, water, heating oil, bottled gas, trash and garbage collection, wood and other fuels, septic cleaning, cable television, internet services, telephone and cell phone.

Everything on those lists goes into one number. Form 433-A (Rev. 6-2026) line 37 is "Housing and Utilities." There is no separate line for your phone. The IRM says so directly: "An allowance for cell phone, cable television and internet service expenses is included in the Housing and Utilities standard."

Primary residence only

The standard applies to your primary residence. IRM 5.15.1.10.1 says other housing expenses "should be allowed only if, based on a taxpayer's individual facts and circumstances, disallowance will cause the taxpayer economic hardship." A vacation condo is an asset to be valued, not an expense to be allowed.

Lesser of actual or standard

The rule is simple. IRM 5.15.1.10.1: "Taxpayers are allowed the standard amount for housing and utilities or the amount actually claimed and verified by the taxpayer, whichever is less."

That is the opposite of the National Standards. If your housing costs are below the county standard, you get your actual cost, not the standard. If they are above, you get the standard unless you prove a deviation is necessary.

The numbers in the Tampa Bay area

The standards are set for every county, by household size, and derived from U.S. Census Bureau American Community Survey and BLS data. Here are figures for several Florida counties from the Collection Financial Standards effective June 29, 2026:

Look at the spread. A two-person household in Miami-Dade is allowed $791 more per month than the same household in Polk County. Over a year, that is close to $9,500 of difference in what the IRS thinks you can pay. Your county line on Form 433-A matters.

The IRS publishes the full table for every county on its Collection Financial Standards page. Look yours up rather than guessing.

Who counts as household

IRM 5.15.1.10.1 says family size should generally match the taxpayers and dependents claimed on your most recent tax return, with reasonable exceptions such as foster children or pending adoptions. If you live with a non-liable partner or roommates, the shared expense rules apply. For housing, the liable taxpayer is allowed the lesser of the percentage share of the household standard, the percentage share of the actual expense, or the standard for one person. See shared household expenses.

Asking for more than the standard

You can. IRM 5.15.1.10.1 says if the amount claimed is more than the standard, "the taxpayer must provide documentation to substantiate those expenses are necessary." All deviations "must be verified, reasonable and documented in the case history."

Then it gives the employee three specific things to weigh when deciding whether a deviation is appropriate:

• The cost of moving to a new residence.
• The increased cost of transportation to work and school that would result from moving to lower-cost housing.
• The tax consequences, meaning the difference in the benefit you get from mortgage interest and property tax deductions.

Use those three factors. They are the IRM's own words. A family whose children attend a nearby school, who would face a long commute and a deposit, first month and moving truck to relocate, has a real argument that the higher housing cost is cheaper than the alternative.

The handbook also gives a disability example in IRM 5.15.1.2: "A taxpayer with physical disabilities or an unusually large family requires a housing cost that is not anticipated by the local standard." Accessibility modifications and the limited supply of accessible housing are legitimate reasons to exceed the standard.

What does not work: IRM 5.15.1.8 says a deviation "is not allowed merely because it is inconvenient for the taxpayer to dispose of valued assets or reduce excessive necessary expenses." A big house you like is not a reason.

Utilities that are not monthly

Florida electric bills in August are not Florida electric bills in January. IRM 5.15.1.3 tells employees to average expense items with varying monthly payments over 12 months. Bring twelve months of utility bills, and property tax and insurance bills that are paid annually. The Form 433-A instructions say to add the average monthly amounts for property taxes, insurance, maintenance, dues, fees and utilities to the rent or mortgage payment.

Renters versus owners

Renters have the simpler case. Rent, renter's insurance and utilities add up to one verifiable number, and a lease plus a few months of bank statements usually proves it.

Owners have more pieces. The mortgage payment, which may or may not include escrow for taxes and insurance, property tax bills, homeowner's insurance, HOA or condo dues, and necessary maintenance all count toward the housing figure. Do not double count. If your escrow covers taxes and insurance, do not list them again. If it does not, add the annual bills divided by twelve.

Condo and HOA owners sometimes face special assessments on top of regular dues. A documented assessment for required repairs is a necessary housing cost, and it can push an otherwise modest housing budget above the standard. Bring the association notice and the payment schedule.

A worked example

A married couple in Pasco County with one child rents a house for $2,050 and pays about $430 a month for electric, water, internet and phones. Their actual housing and utilities total $2,480. The June 29, 2026 Pasco County standard for three persons is $2,367. Under the lesser-of rule, the IRS allows $2,367, and $113 a month of their real housing cost shows up as income available to pay.

That $113 may decide whether they are a hardship case or an installment agreement case. If they can show the higher cost is necessary, for instance because the only rental near the child's medically necessary school costs more, they can ask for a deviation using the factors above. If they cannot, they should know the IRS number before they sign anything.

Equity is a separate question

The housing standard is about monthly cost. Equity in the house is an asset question handled under IRM 5.15.1.31. A taxpayer can be in hardship on a monthly basis and still be asked to borrow against home equity, unless borrowing or selling would itself create an economic hardship. That exception is written into the IRM. See home equity and asset equity in hardship cases.

Know your county number before you talk to the IRS. It is the single most important figure in most household budgets the IRS will ever review.