For those without a taxhome

NedRN · Dec 20, 2012

Well, what do you get from the IRS if you have a tax home? Lets say you conservatively get $20,000 a year in tax free benefits in the form of housing, per diems, and travel pay. If you are in the 35% bracket (including state and federal taxes), that is $7,000 more a year in your bank account.Obviously, this math doesn't work well if you have to pay $12,000 a year to get this benefit. I suspect most experienced travelers get more like $30,000 a year in tax benefits from traveling, but that would still get you only close to breaking even.Itinerant status (no home) is certainly one solution. Another is buying a modest home and getting a roommate to cover the mortgage payments. Then your tax free stuff is fully to your benefit, and your home may appreciate as well. You can do the same thing with a 2 bedroom or larger apartment as well, you just lose any capital benefits from potential home appreciation.Obviously, if an agency will roll your tax free into your hourly, your OT will benefit. An agency that knows what they are doing will not do that for IRS reasons (as well as not paying you extra OT), but continue paying per diem and housing and taxing it. By the way, your total pay will probably drop a bit as the agency now has to pay their share of FICA, workers comp, and unemployment on your now taxable reimbursements. That is about 10 percent on that money. And of course so will you. So if you can preserve your tax home, and are a good money manager, you will probably come out ahead.

ChristopherB, BSN, RN · Dec 20, 2012

Do you have a relative's house you can use as your "tax home" while you are traveling?

sweetgurly25 · Dec 21, 2012

so its better to have a tax home. yes I do have relatives that I can use. I will think about it though. because I don't want to pay rent anymore.

cosmicmama, BSN, RN · Dec 22, 2012

I have read that if you use a relative's address for your tax home, that it's best to send them a check every month for a few bucks to show you're paying "rent".

NedRN · Dec 22, 2012

An address change to a relative's home is unlikely to fly with the IRS who will think you are using an address of convenience and that you are still itinerant in an audit. You will have to prove that you are really living there, and paying nominal rent will not be enough.

Lovelymo79 · Feb 6, 2013

NedRN, so is it better to be a it better to be a itinerant traveler with no home? I want to give up my apartment at the end of my lease and just stash my stuff in storage. Will my incidentals like housing, meals and all be non-taxable? Or would it be better like you said to get a roommate and use a permanent home address? I would prefer to not have to worry about an apartment and such. I do plan on returning to my present state (TX) in between assignments and stay with a friend..unless I change my mind. I also plan in keeping my TX driver's license and car with TX tags.

I do have some time to decide but I was just wondering. Thanks.

NYcDcG · Feb 7, 2013

I am a similar boat and am wondering what to do. I have no desire to own a home, only rent which costs me $1400/mo. in a place that doesn't allow subletting. I was thinking of becoming itinerant, and taking the stipend/per diem as taxable all the time.

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NedRN · Feb 7, 2013

Better? Two things to consider: financial and personal. Both are multifactorial calculations. You can crunch the numbers for various scenarios and plug the results into your personal preferences. If you are lucky your decision will be easy.

ChristopherB, BSN, RN · Feb 12, 2013

I have read that if you use a relative's address for your tax home, that it's best to send them a check every month for a few bucks to show you're paying "rent".

If you use a relative's address, you need to legally chage your driver's license address, voter's registration, RN license address, banking, etc... and return to that address occasionally for it to be acceptable to the IRS.

NedRN · Feb 12, 2013

If you use a relative's address, you will have a big red flag if you get audited. You will have to demonstrate a quid pro quo relationship, i.e. fair rent paid, a room that is exclusively for your use, and genuine ties to the area. You probably need a counter balance to all that negativity, and working locally would be a big help (one of the three piers of a tax home - you need 2 out of three to qualify at all).

mccoys25 · Feb 12, 2013

I am having the same issue. I had to turn down a travel position because I live alone and I dont want to have a lease and be responsible when I may be any where in the US. Im really interested in the replies. Subletting is not that easy to do.