RV advice

NedRN · Sep 28, 2012

An RV cannot be a tax home unless it is in a fixed location (does not move), which kind of defeats the purpose. You also cannot have a tax home that is just a pad for the RV when you are there. An RV can be deductible as a second home.

For more information, take a look at RV forums online. Google Escapees, RV dot net, and iRV2 and look for their "Fulltimers" or "Working on the Road" subforums for info pertinent to nurse travelers.

RNERHOUSESUPOR · Sep 30, 2012

I agree with all NedRN wrote. If you have a permement place in addition to your RV, you "MAY" have a tax home, but most likely not it seems. Most of my initial beliefs were from speaking with Travel Company recruiters. It may have been OK back in the 1900's but not in the 2000's. Contact with a Tax Professional who works with Travel Professionals is a must.

As far as finding your perfect RV, it's going to take a while. You will be drawn to the new models on the lot, they look very pretty all set up and "staged" and for the first 6 months to a year they will still look pretty good. I used my Brothers newer trailer for several months and "thought" I knew what I needed and didn't need. Spent another year looking at everything I could. Finally found a used Weekend Warrior 45 foot Toyhauler. It seemed to have everything I needed and has served me well. I am contemplating a replacement in the near future though.

My tow vehicle is one I will keep for a very long time though, and it is also considered an RV. I use it for short weekend trips and overnight stays. It may not be for everyone, but most who have gone to the "dark side" will not go back to any other tow vehicle. A few that I have known have gone to a large Class A diesel pusher. So, depending on how long you plan to travel, where you think you will be working and how far you feel you might need to travel between jobs, will all need to be evaluated.Will you need additional transportation, or will you be wanting to use your " tow vehicle" for everything? You won't be making additional money having an RV, until it's paid for and is still providing you with a safe, dry and mobile home. It is nice going home every night to the same place, no matter what state it may be in. Good luck with your search.

Rod

nursetaminator · Sep 30, 2012

My husband and I plan to start travelling in a few years in an RV and will keep a home base in Texas. There are a lot of particulars/legalities about being able to use the housing stipend as a tax advantage or tax free. In our case we'll keep a residence in Texas (and "residence" can be a number of different things). I believe the tax savings part comes in bc you're having to maintain 2 homes - your permanent residence and the RV/lot rent/etc. I'll have to come back home each year for about 30 days to show I'm still maintaining "residency" in Texas. Not sure if those 30 days will be consecutive or if we'll just stop by for a week or so between jobs.

As for the RV, take a day and go visit several RV dealerships. Walk through as many RV's as you can. You'll start to get a feel for what you like and don't like. See if there are any RV shows nearby - they'll have practically one of each from the least expensive to high end models. RV's are like anything else: you get what you pay for. Keep in mind if you buy new they depreciate quite a bit. Maybe start out w/ something used and inexpensive (but comfortable) to see if you even like the RV lifestyle. Then if you do, you can easily upgrade.

People on the RV forums are wonderful at helping with specific RV questions. They'll be great at being able to steer you toward the correct tow vehicle also. Be wary of some RV salespeople - they're not always truthful about what size truck you need to tow with. Yes you can tow a lot of RV's with a half ton truck but you need stopping power along with pulling power. We ran into that when we purchased a trailer years ago - salesman said we could pull it with a half ton but we knew better.

Good luck!

Tam

NedRN · Sep 30, 2012

I'm a friend of Traveltax, in fact we serve together on a non-profit board. There are a number of tax absolutes, like using your RV as your primary home is a tax no-no (at least to decrease your tax liabilities by taking tax free money from agencies). Then there are guidelines coming from the IRS, agencies, and tax professionals, which help to instruct those without basic understanding (probably most taxpayers). But it is easy to run afoul just using guidelines without understanding what they are for. For example, agency guidelines will not protect you in an audit as agency guidelines are there to protect agencies not travelers, as well as to maintain competitive with other agencies in recruiting travelers. Neither will a simple 30 days at home guideline.

The guidance for this particular point that the IRS gives (I believe you can find it in IRS Publication 463 in the Tax Home section) is that you should return home regularly. That is it. No 30 day rule. Period. In the last few days, someone posted here that he had to go home between every assignment. No. None of these guidelines you hear about should be sweat invoking. If you work away from home for 13 months (at more than one location) before getting home, that is probably OK. If you zoom home for a few days here and there, that is probably OK as well.

I say probably OK because maintaining a tax home and working within the rules and guidelines is generally not absolute. Instead it is a preponderance of the evidence and your total situation that will be presented in Tax Court (an auditor may deny your tax home status as the initial auditor is often not an expert on travel professionals either).

So there are some simple things you have to abide by to maintain your tax home status generally. You must maintain an abode (could be as little as a roommate situation) in an area you have historical ties to: have lived there for some time, perhaps worked there, and really live there currently. Your ties are strong, you may vote there, register your car there, library card, primary care physician, have family members there and so on. In fact your ties are so strong that it would be odd if you didn't return there on a regular basis. Work wise, you need to be away from home on a temporary basis (your time limited travel contract supplies proof of that). You must not indicate abandonment or a shift of your tax home by working in the same general area for more than one year (or even promising to do so), or by shifting your driver's license and car registration to the work area (also just evidence, not an absolute), or by renting out your tax home.

For those travelers who are expecting to travel for years, it is a really good idea to wrap your head around some of these concepts. I'm a bit of a tax nerd so I actually enjoy reading IRS publications. More realistically, cruise the excellent articles on travel taxation at Traveltax and PanTravelers, and read them several times until it starts to soak in. It is best that you do this before you start traveling as it will be more difficult to set up a legitimate tax home after you start. So kudos to those here that are making sure of tax stuff before hitting the road!

Sorry about the lengthy rant. It just kind of sets me off when I see the potential for someone to believe they are doing the right thing just working on a single factor like some 30 rule. These things get around on the Internet and pretty soon it is common knowledge that a 30 day rule (some agencies live by this "rule" to internally determine a traveler's eligibility for tax advantage) is a fact.

Of course, returning home regularly is not well defined, so if other factors of your tax home are a less solid, you can pump up this factor to compensate. That is part of your total picture. You do have to protect yourself in the case of an admittedly rare audit for taxpayers in our tax bracket, and no agency or tax preparer can be totally responsible for your choices.

One last bit of advice, the more aggressive you are with your personal returns, the more conservative you should be with your tax home details. The vast majority of travelers who are audited are because of aggressive personal deductions, not tax free money received from agencies (which is not reported to the IRS). There are serious risks involved with taking deduction or tax free money that you are not entitled to, and can cost you big in back taxes, interest, and penalties, especially if you have been doing it for several years.

All of this may sound off topic in an RV thread, but it is easy for full-timers to go off track with their RV lifestyle.

nursetaminator · Sep 30, 2012

I'm kind of confused Ned. Traveltax told me about the 30 days; not necessarily consecutive but their suggestion was plan on being home at least 30 days out of approximately a years worth of travel. But 30 was simply a guideline since there is no hard and fast rule from the IRS how long you'll need to return home. Just have to show one still has good, solid ties to their main homestead such as coming back for doctor's appt's, voting, etc. At least that's what I got from my conversation with Traveltax. They really were great at answering all the questions I'd gathered from reading various posts from others. Most all the info I had was correct, just a few things were a little different bc of our personal situation.

Anyhow, didn't intend to mislead anyone about the 30 days. It is though something people need to be aware of, plan for and talk about with their tax professional. Because the last thing anyone wants is to get tangled up in a mess w/ the IRS.

NedRN · Sep 30, 2012

Yes, that is a guideline that Joe is recommending. But it is not a rule. Yet. On another forum he did say that there is a recent IRS actual ruling about time at home. He is going to discuss it at the Staffing Summit in Vegas and presumably make recommendations to agencies. The Traveler's Conference immediately follows that one (in the same hotel even) and he is planning on updating the community about that ruling.

So I might be wrong, and it could be closer to a rule now than simple common sense guidance. But I have read these cases before and I usually don't see them the same way Joe does. Part of it is a different perspective as by nature and training tax preparers are conservative bunch. Tax lawyers, on the other hand, are really out there. Somewhere in the middle is usually optimal. A lot of tax decisions are based on risk tolerance. Frankly the risk for travelers who understand the situation and behave accordingly, and do not get audited for a different reason is extraordinarily low. Individual's risk tolerance may be below that.

I would guess, as does Joe, that well over half of all travelers would not do well in an audit. Very few get audited, we are just not in an interesting tax bracket for the IRS to target us. The real risk is working for agencies who may get audited (they have been in the IRS bullseye for over 10 years), with followup audits on random travelers who worked for that agency just to check things out. That is the scare story, but I have yet to hear of one traveler being audited because the agency was under investigation. Agencies are the relatively deep pockets here, and who the IRS will target selectively over lower middle class employees (with everyone seeming to agree that 250K a year is still middle class). Just not worth their time to audit travelers unless we really stick out.

NedRN · Oct 1, 2012

I talked to Joe today and got some interesting information about agency audits. He knows of 15 agencies, both large and small, being audited in a big push by the IRS. The process begins by auditing travelers first, something I was unaware of. The IRS looks at an agency of interest employer identification number and matches employees and ex-employees of that agency from the payroll reports. They audit a certain number, Joe says typically 30. The auditors of these travelers have no idea why they were selected to be audited, and so the actual target company, even if they hear from some of their travelers about an audit, would have no way of knowing that they are the real target of the investigation. Until they are audited themselves. Surprise!

Since TravelTax represents so many travelers, he can often identify the agency being targeted. The vast majority of these traveler audits are correspondence audits only and apparently begin with requests for more information about itemized deductions. Since I don't itemize myself, I asked Joe who gets audited. The IRS only picks those travelers who itemize. Not hard to do with their database, and apparently taxpayers like myself who do not itemize are in the minority of filers.

So I'm wrong about the risk of travelers getting audited even though it is seldom reported on traveler forums. Taking TravelTax at his word (who I have zero reason to doubt in factual matters), 15 agencies times 30 travelers equals 1,500 travelers audited. That is a large percentage of all travelers.

While the need for warning travelers is probably too late at this point, it does reinforce the need to keep your tax home honest if you are taking tax free money from agencies. Even more so for the double dipping that is relatively common, in part because most tax preparers are so clueless about travel nurses. Double dipping is taking tax free money, and then itemizing the same expenses on your tax return. I've talked to a number of travelers that do this, because they didn't tell their tax guy about reimbursements (and you can't usually tell from the year end W-2) and the tax preparers tell travelers that they can use Publication 1542 (or the GSA tables) to deduct per diems and deduct receipted housing as well. That's really bad! Then there are all the travelers that don't have a legitimate tax home and take tax free money because their agency said they qualify (or coach them how to fill out the housing form).

cryptic12 · Oct 1, 2012

Thanks for the info and RV sites to check out.

cryptic12 · Oct 1, 2012

An RV cannot be a tax home unless it is in a fixed location (does not move), which kind of defeats the purpose. You also cannot have a tax home that is just a pad for the RV when you are there. An RV can be deductible as a second home.
For more information, take a look at RV forums online. Google Escapees, RV dot net, and iRV2 and look for their "Fulltimers" or "Working on the Road" subforums for info pertinent to nurse travelers.

Thanks for the info. and RV sites to check out.

cryptic12 · Oct 1, 2012

I'm a friend of Traveltax, in fact we serve together on a non-profit board. There are a number of tax absolutes, like using your RV as your primary home is a tax no-no (at least to decrease your tax liabilities by taking tax free money from agencies). Then there are guidelines coming from the IRS, agencies, and tax professionals, which help to instruct those without basic understanding (probably most taxpayers). But it is easy to run afoul just using guidelines without understanding what they are for. For example, agency guidelines will not protect you in an audit as agency guidelines are there to protect agencies not travelers, as well as to maintain competitive with other agencies in recruiting travelers. Neither will a simple 30 days at home guideline.
The guidance for this particular point that the IRS gives (I believe you can find it in IRS Publication 463 in the Tax Home section) is that you should return home regularly. That is it. No 30 day rule. Period. In the last few days, someone posted here that he had to go home between every assignment. No. None of these guidelines you hear about should be sweat invoking. If you work away from home for 13 months (at more than one location) before getting home, that is probably OK. If you zoom home for a few days here and there, that is probably OK as well.
I say probably OK because maintaining a tax home and working within the rules and guidelines is generally not absolute. Instead it is a preponderance of the evidence and your total situation that will be presented in Tax Court (an auditor may deny your tax home status as the initial auditor is often not an expert on travel professionals either).
So there are some simple things you have to abide by to maintain your tax home status generally. You must maintain an abode (could be as little as a roommate situation) in an area you have historical ties to: have lived there for some time, perhaps worked there, and really live there currently. Your ties are strong, you may vote there, register your car there, library card, primary care physician, have family members there and so on. In fact your ties are so strong that it would be odd if you didn't return there on a regular basis. Work wise, you need to be away from home on a temporary basis (your time limited travel contract supplies proof of that). You must not indicate abandonment or a shift of your tax home by working in the same general area for more than one year (or even promising to do so), or by shifting your driver's license and car registration to the work area (also just evidence, not an absolute), or by renting out your tax home.
For those travelers who are expecting to travel for years, it is a really good idea to wrap your head around some of these concepts. I'm a bit of a tax nerd so I actually enjoy reading IRS publications. More realistically, cruise the excellent articles on travel taxation at Traveltax and PanTravelers, and read them several times until it starts to soak in. It is best that you do this before you start traveling as it will be more difficult to set up a legitimate tax home after you start. So kudos to those here that are making sure of tax stuff before hitting the road!
Sorry about the lengthy rant. It just kind of sets me off when I see the potential for someone to believe they are doing the right thing just working on a single factor like some 30 rule. These things get around on the Internet and pretty soon it is common knowledge that a 30 day rule (some agencies live by this "rule" to internally determine a traveler's eligibility for tax advantage) is a fact.
Of course, returning home regularly is not well defined, so if other factors of your tax home are a less solid, you can pump up this factor to compensate. That is part of your total picture. You do have to protect yourself in the case of an admittedly rare audit for taxpayers in our tax bracket, and no agency or tax preparer can be totally responsible for your choices.
buying
One last bit of advice, the more aggressive you are with your personal returns, the more conservative you should be with your tax home details. The vast majority of travelers who are audited are because of aggressive personal deductions, not tax free money received from agencies (which is not reported to the IRS). There are serious risks involved with taking deduction or tax free money that you are not entitled to, and can cost you big in back taxes, interest, and penalties, especially if you have been doing it for several years.
All of this may sound off topic in an RV thread, but it is easy for full-timers to go off track with their RV lifestyle.

Thanks again. Good advice. I've been traveling for about a year and a half now. I do have a tax home, but I'm in the process of selling. I plan on buying another home near my family in a different state and do my traveling from there. I've got a lot of advice from traveltax - great site. I plan to have them do my taxes this year. It was very stressful and confusing doing my taxes last year being a new traveler. This year, I had forms from Traveltax to use throughout the year to organize my expenses which makes tax time so much easier. It was hard to get advice being a newbie, so I hope other new travelers read your post and are able to use the info to start a smart legal travel career.

cryptic12 · Oct 1, 2012

On the 30 day guide line, do you just have to be at your home base for part of the year, or do you have to work while you're there? I was under the impression that you had to work.