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Bon Homme County, South Dakota: IRS Wage Levy & Hardship Solutions

Last updated: May 29, 2026 · Sources: IRS.gov, HUD.gov, BLS.gov

Understanding IRS Collection Standards in Bon Homme County, SD

For taxpayers in Bon Homme County, South Dakota, facing IRS collection actions, understanding the IRS Collection Financial Standards is paramount. These standards, utilized when evaluating your ability to pay via Form 433-A (Collection Information Statement), determine your allowable monthly living expenses. The IRS assesses your disposable income by subtracting these National and Local Standards from your gross income. For instance, a single individual in Bon Homme County is allowed $812 for Food, Clothing, and Other necessary expenses, as per the IRS National Standards derived from the Bureau of Labor Statistics Consumer Expenditure Survey. While specific local housing standards are not provided for Bon Homme County, the IRS considers actual, reasonable expenses. The ultimate goal is to determine if you meet the criteria for economic hardship, as defined under Internal Revenue Code (IRC) §6343(a)(1)(D), which could lead to a levy release or Currently Not Collectible (CNC) status. This data is rigorously compiled from IRS.gov, Bureau of Labor Statistics, and U.S. Census Bureau sources.

Bon Homme County Housing & Utilities Allowance vs. HUD Fair Market Rent

Residents of Bon Homme County, South Dakota, should note that the IRS Collection Financial Standards do not provide a specific housing and utilities allowance for this area (listed as N/A). In such cases, the IRS evaluates your actual housing and utility expenses for reasonableness and necessity. It is crucial to demonstrate that your rent and utilities are essential and not extravagant. For comparison, the U.S. Department of Housing and Urban Development (HUD) Fair Market Rent (FMR) for Bon Homme County in FY2025 indicates a 2-bedroom unit at $950.0 per month. While this is not an IRS allowance, it serves as a valuable benchmark for what the IRS may consider a reasonable housing expense in your area. If your actual expenses exceed the standard, you may be able to argue for a deviation under Internal Revenue Manual (IRM) 5.15.1.10, especially if your housing costs align with or are below the HUD FMR. Regional Shelter CPI data is not available for this specific region, so direct comparison to inflation trends is not possible.

Food, Healthcare & Transportation Allowances

Beyond housing, the IRS provides clear allowances for other essential living expenses for Bon Homme County residents. The National Standards for Food, Clothing, and Other expenses are critical: a single individual is allowed $812 per month, two persons $1,478, three persons $1,697, and a family of four $1,983, with an additional $357 for each additional person. These figures are based on the Bureau of Labor Statistics Consumer Expenditure Survey. For healthcare, the IRS National Standards for Out-of-Pocket Healthcare allow $75 per person per month for individuals under 65, and $153 per person per month for those 65 and over, derived from the Medical Expenditure Panel Survey. Transportation is also covered by Local Standards for Bon Homme County, SD. For one car, the ownership cost is $588 per month, and operating costs for the region are $270 per month, totaling $858. For two cars, the ownership cost is $1,176, making the total $1,446. These transportation allowances are based on Bureau of Labor Statistics data and American Automobile Association operating costs.

Qualifying for Currently Not Collectible (CNC) Status in South Dakota

For taxpayers in Bon Homme County, South Dakota, facing significant financial hardship, achieving Currently Not Collectible (CNC) status can halt IRS enforced collection actions like wage or bank levies. To qualify, you must demonstrate to the IRS, typically through Form 433-A, that your allowable monthly living expenses equal or exceed your monthly income, leaving you with no disposable income to pay your tax debt. For a single filer in Bon Homme County, a hypothetical calculation might include: $950.0 for housing (based on HUD FMR for a 2BR as a reasonable expense where local IRS standard is N/A) + $812 for food + $75 for healthcare (under 65) + $858 for transportation, totaling $2,695 in allowable expenses. If your income is less than or equal to this amount, you may qualify. The IRS outlines procedures for CNC status in IRM 5.16.1, and achieving this status can lead to a levy release under IRC §6343. Importantly, while CNC status pauses collection, it does not stop the Collection Statute Expiration Date (CSED) from running, which is generally 10 years from the tax assessment date under IRC §6502.

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Frequently Asked Questions

For Bon Homme County, South Dakota, the IRS Collection Financial Standards do not provide a specific housing and utilities allowance, listing it as 'N/A'. This means the IRS will evaluate your actual, reasonable, and necessary housing expenses. For guidance, the HUD FY2025 Fair Market Rent for Bon Homme County indicates a 2-bedroom unit at $950.0 per month. While this is not an IRS standard, it can serve as a benchmark for what the IRS might consider a reasonable expense. If your actual housing costs are higher but justifiable due to specific circumstances, you may be able to argue for a deviation under Internal Revenue Manual (IRM) 5.15.1.10, provided you can substantiate the necessity.
To qualify for Currently Not Collectible (CNC) status in South Dakota, you must demonstrate to the IRS that you lack the financial ability to pay your tax debt. This is primarily done by submitting Form 433-A, Collection Information Statement, which details your income, assets, and allowable monthly expenses. The IRS compares your income to the National and Local Collection Financial Standards, including specific amounts for food ($812 for a single person), healthcare ($75 for under 65), and transportation ($858 for one car, including ownership and operating costs). If your total allowable expenses equal or exceed your total monthly income, leaving no disposable income, the IRS may place your account in CNC status, suspending active collection efforts under IRM 5.16.1. This status can also lead to the release of a levy under IRC §6343.
When the IRS issues a wage levy (Form 668-W) in Bon Homme County, South Dakota, the amount they can take from your paycheck is determined by specific exemption tables in IRS Publication 1494. For 2025, a single individual with zero dependents has $1,096.67 per month exempt from levy, while a single individual with one dependent has $1,680.0 exempt. For a married individual filing jointly with zero dependents, $1,096.67 is exempt, and with one dependent, $2,286.67 is exempt. The IRS calculates the non-exempt portion by taking your wages, subtracting the standard deduction and exemptions you claim, and then applying the Pub 1494 table. Any amount above your exempt figure can be levied. State wage garnishment laws in South Dakota follow federal CCPA limits, which are less restrictive than IRS levies.
Since the IRS Collection Financial Standards do not provide a specific housing allowance for Bon Homme County, South Dakota, you will be allowed your actual, reasonable housing expenses. If your rent, for example, is $950.0 for a 2-bedroom unit (based on HUD FY2025 Fair Market Rent), the IRS will scrutinize this amount for reasonableness. If your rent exceeds what the IRS deems reasonable without proper justification, they may only allow a portion of it. However, if you can demonstrate that your higher rent is necessary due to specific circumstances (e.g., medical needs requiring a larger space, no cheaper alternatives available), you can request a deviation from the standard under Internal Revenue Manual (IRM) 5.15.1.10. Providing documentation such as your lease agreement and local rental market data can strengthen your case.
The IRS generally has 10 years to collect a tax debt, starting from the date the tax was assessed. This period is known as the Collection Statute Expiration Date (CSED), as outlined in Internal Revenue Code (IRC) §6502. It's crucial to understand that while certain actions, such as filing for bankruptcy or an Offer in Compromise, can pause or extend this 10-year collection window, achieving Currently Not Collectible (CNC) status typically does not. If your account is placed in CNC status in Bon Homme County, South Dakota, the IRS suspends active collection efforts, but the CSED continues to run. This makes CNC a powerful strategy for taxpayers nearing the end of their collection statute, as it can allow the statute to expire without the IRS taking further enforced collection actions.

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