JK Harris Gives Thumbs Up to IRS' New Living Expense Standards

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JK Harris Directors are pleased with changes the IRS has made to its Allowable Living Expense Standards.

The IRS recently changed its Allowable Living Expense Standards, and JK Harris and Company Directors are pleased with the improvements, especially regarding the transportation and health care standards. These IRS standards are used to determine a taxpayer's ability to pay a delinquent tax debt.

"The change to the transportation expenses is awesome," said Chris DuBeau, Director of the Support Division for JK Harris, the nation's largest tax resolution firm.

The change gives equal value of ownership costs for first and second cars, as well as adding an allowance for public transportation. The allowance for the no car standard was removed.

"A big key is if you own a car and drive it, but for some reason you also use public transportation, you can claim expenses for all three," said Kelly Scott, Director of Training and Customer Service.

As for health care, the IRS added a new category for out-of-pocket health care expenses. Taxpayers under the age of 65 can add $54 dollars of out-of-pocket expenses, while those 65 and older can add $144.

"The nice thing is this is in addition to what they are paying for health insurance and medical bills," said Scott.

Other standards that have been changed include:

  • The elimination of income ranges for national standards for food, clothing and other items.
  • A nationwide set of tables for national standard expenses, eliminating separate tables for Alaska and Hawaii.
  • An expanded number of household categories for housing and utilities.
  • An allowance for cell phone costs in housing and utilities.
  • Fewer Metropolitan Statistical Areas for vehicle operating costs.

"We're glad they're making it a little more user friendly," Scott said. "The figures are still a little bit low, but they are moving in the right direction."

The changes went into effect on October 1. The previous standards had been in place since February 1, 2006.

About JK Harris:
JK Harris & Company, LLC, (http://www.jkharris.com) based in North Charleston, S.C., is the nation's largest tax resolution firm and has served over 200,000 customers since its founding in 1997 by John K. Harris. JK Harris consultants are available to meet with consumers in over 425 locations nationwide by appointment only. The company also provides services for student loan debt, investment fraud, fee-based financial planning, tax return preparation, and audit representation.

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