Travel Nursing: What is a tax home

In order to get the most bang for your buck as a travel nurse you’re going to need some sort of permanent residence or “tax home.”

The IRS defines the “tax home” as the taxpayer’s regular place of business (i.e., the geographic area where the majority of the taxpayer’s
income is earned). This includes the entire city or general area in which the work is performed. For individuals who have more than one regular place of business, the tax home is the main place of business taking into account time spent, level of business activity, and the significance of the associated income.”

Now if you don’t want to go out and buy a house, don’t. You will, however, need a permanent address if you want to take advantage of the tax free benefits of the travel lifestyle.

Meaning, you will receive a percentage of your pay that isn’t taxed. You will very soon become majorly attached to this benefit.

A common question: Can I say I live at home with my parents and still receive the benefits? The answer is yes, however, nothing is free in this world. You will need to be able to provide proof that you are contributing in a significant way to the expenses. So you cant write a $20.00 check for rent and expect that will suffice. This could cause an audit.

The reason you are able to receive that extra income tax free is because you have expenses elsewhere in which you need to contribute. You are relocating for this job you are taking.

What if I want to travel without having a permanent residence will I still get the benefits of a traveler? Yes, you have the option to receive the same amount of pay, but the difference will be, your entire paycheck will be taxed.

Also, be mindful about the time you spend at each destination. After you’ve been in one location over a year. You are no longer considered a traveler.

Having a tax home gives you significant benefits on deductions come tax time!

Attached is a worksheet with guidelines on determining what’s needed for a “tax home” to actually be a tax home.

***This worksheet is to be used as a guide, is not affiliated with this company and it is only to be used for reference to better understand the concept of a tax home.

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