Local Taveling Housing Stipend

[Eldrad]

I am looking into starting my first travel assignment. I have asked some friends about things to watch out for and feel that I have everything I need in my contract. My only concern is that I am being offered $X a week broken down as...

$X an hour

Meal stipend -$X

Housing Stipend- $X

$XXXX Net weekly after taxes

I only live 41 miles from the hospital. Do I have to worry about them taking the stipends away (They promised me they wouldn't and I don't see any fine print saying they can) and do I have to worry about having to pay extra taxes at the end of the year because I only live 41 miles away.

Thanks!

Eric

[NedRN]

Commuting from home doesn't bring you tax breaks that you have incurring business expenses such as duplicated housing. Thus all compensation must be taxed.

If you don't declare those stipends on your tax return and are later audited, you will owe back taxes, interest, and penalties. Technically they could file criminal charges as well if they have evidence you didn't pay with knowledge of the law (like a social media post like this one). You have probably been counseled by the agency to use a different address, so falsifying the housing statement the agency will make you sign is documentary evidence.

While personal audits are pretty rare in our tax bracket, the IRS is working through every travel company because of these abuses. Thus your risks are higher.

Kind of changes the equation, right? Not worth the risk to cheat the IRS. Keeping your staff job will may actually pay you better when you consider the benefits.