A tax home is the general area of your regular place of business or the main place where you live and incur significant recurring expenses. For travelers, maintaining a tax home is the only way to legally receive tax-free stipends. Without one, the IRS considers you "itinerant," meaning all your income (including stipends) is 100% taxable..

To qualify for tax-free stipends, you must prove you are paying to maintain your primary residence while simultaneously paying for lodging at your assignment. This is proven through rent receipts, mortgage statements, and utility bills. Paying "shared expenses" or a small token amount to parents often fails an audit; you should pay Fair Market Value for your area.

Generally, yes. You must file a non-resident return for every state where you earned income, plus a resident return for your home state. However, most home states will grant you a "credit for taxes paid to another state," which prevents you from being double-taxed on the same dollar.

The IRS considers an assignment "temporary" only if it is expected to last—and actually lasts—less than one year. If you stay in one metropolitan area for more than 12 months (even if you switch hospitals or agencies), that location becomes your new tax home. At that point, all stipends become taxable income.

No. The IRS looks at a "rolling 24-month period." If you spend more than 12 months in a single location within any 24-month window, you have effectively moved there in the eyes of the IRS. A short break is usually not enough to "reset" the clock.

No. The "50-mile rule" is a myth. The IRS does not have a specific mileage requirement. To receive tax-free stipends, the assignment must be far enough away that it is unreasonable for you to commute home daily and requires you to sleep overnight near the facility.

If you are a W-2 employee, the answer is currently no for federal taxes. The Tax Cuts and Jobs Act of 2018 suspended "unreimbursed employee business expenses." However, some states (like California, New York, and others) still allow these deductions on your state return, so keep your receipts!

If you are 1099, you are considered self-employed. Unlike W-2 employees, you can deduct all ordinary and necessary business expenses (scrubs, travel, home office, health insurance premiums) on Schedule C of your federal return.

Yes, but it must be a formal arrangement. You should have a written lease agreement and pay "Fair Market Value" rent. If you pay $200/month for a room that normally rents for $800, the IRS may view this as a "sham" transaction and disqualify your tax home.

If you sell your house or end your lease at home and continue traveling, you become an "itinerant" worker from that date forward. You must notify your agency so they can start taxing your stipends; otherwise, you will likely owe a large sum in back taxes and penalties when you file.

If you are receiving a standard per diem (stipend) and you have a valid tax home, you generally do not need to keep every food receipt. However, you should keep a log or calendar of the days you were actually at the assignment to justify the number of days you received those stipends.

The IRS generally has three years to audit a return, but in some cases, they can go back six years. We recommend healthcare travelers keep digital copies of all contracts, mileage logs, and "duplication of expense" receipts for at least seven years.