Navigating IRS Wage Levy & Hardship in Pulaski County, Virginia

When facing IRS enforced collection actions, such as a wage levy (Form 668-W) or bank levy (Form 668-A), taxpayers in Pulaski County, Virginia, must understand the IRS Collection Financial Standards. These standards are critical for determining a taxpayer's ability to pay, which the IRS assesses using Form 433-A, Collection Information Statement for Wage Earners and Self-Employed Individuals. The IRS calculates your disposable income by subtracting allowable living expenses, categorized into National and Local Standards, from your gross income. For a single individual in Pulaski County, the National Standard for Food, Clothing & Other is $812 per month. While specific local housing standards for Pulaski County, VA, are not provided by the IRS, your actual, reasonable housing and utility expenses will be scrutinized. The IRS is mandated by IRC §6343(a)(1)(D) to release a levy if it creates an economic hardship, meaning you cannot meet basic living expenses. This data is derived from authoritative sources like IRS.gov, Bureau of Labor Statistics (BLS) Consumer Expenditure Survey, and US Census Bureau American Community Survey.

For Pulaski County, VA, the IRS Collection Financial Standards do not provide a specific local allowance for Housing and Utilities, indicating a 'N/A' status. This means taxpayers must report their actual housing and utility expenses on Form 433-A. However, these reported expenses are subject to IRS review for reasonableness. For context, the HUD Fair Market Rent (FMR) for FY2025 in the Pulaski County, VA HUD Metro FMR Area indicates a 2-bedroom unit costs $1160.0 per month, and a 1-bedroom is $940.0. If a taxpayer's actual rent exceeds what the IRS considers reasonable, or if it exceeds a hypothetical standard, they may need to seek a deviation. Internal Revenue Manual (IRM) 5.15.1.10 outlines the procedures for allowing expenses exceeding the standard amounts, requiring substantiation and justification for why such an expense is necessary and reasonable. Demonstrating that your actual housing costs align with or are below the HUD FMR can strengthen your argument for their allowance. Unfortunately, regional Shelter CPI data for this specific area is not available from the Bureau of Labor Statistics, which might otherwise provide additional context on housing cost inflation.

Beyond housing, the IRS allows for other essential living expenses based on National and Local Standards. For food, clothing, and miscellaneous personal items, the National Standards are crucial. A single person in Pulaski County, VA, is allowed $812 per month, while a family of four is allowed $1983 per month. These figures are based on the Bureau of Labor Statistics Consumer Expenditure Survey. Healthcare is another vital allowance, with a National Standard of $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. For transportation, the IRS provides Local Standards. In the Pulaski County, VA region, the monthly allowance for owning and operating one car is $588 for ownership costs plus $270 for operating costs, totaling $858 per month. For two cars, the total allowance is $1446. These transportation allowances are based on Bureau of Labor Statistics data and American Automobile Association (AAA) operating costs, reflecting the necessity of reliable transport for employment and essential needs.

Achieving Currently Not Collectible (CNC) status can provide significant relief from IRS enforced collection actions in Virginia. To qualify, taxpayers must demonstrate to the IRS that their allowable monthly expenses meet or exceed their monthly income, leaving no disposable income for tax payments. This is primarily assessed through the submission of Form 433-A, Collection Information Statement. For a single filer in Pulaski County, VA, an illustrative calculation of allowable expenses might include a reasonable housing cost like the 2-bedroom HUD FMR of $1160.0, plus the National Standard for Food, Clothing & Other of $812, a healthcare allowance of $75 (for someone under 65), and a transportation allowance of $858 for one car. This totals $2905.0 in monthly expenses. If a taxpayer's income does not exceed this amount, they may qualify for CNC status. IRM 5.16.1 outlines the procedures for placing an account in CNC status, and IRC §6343 permits the release of a levy if it creates an economic hardship. While in CNC, the IRS will generally cease collection attempts, but the tax liability remains. Crucially, CNC status does not extend the Collection Statute Expiration Date (CSED), which is typically 10 years from the assessment date under IRC §6502, meaning the IRS's time to collect continues to run.