Worth it to keep a tax home?

I know there are bunches of posts already about taxes, but honestly I feel my head is going to explode reading all this and thinking about it. I don't understand how it all works yet, but I am researching. But in the mean time can someone tell me ... I pay $670 in rent where I live now. I just accepted my first travel nurse assignment, which will start in January. I would personally rather just store all my stuff and not have a tax home, but it sounds like travel nurses save so much money by having one.
Based on the rent I pay would do you think it would be worth it to keep my place or store my stuff. I don't want to be burdened with all kinds of tax worries.
So, if I do store all my stuff and go from state to state, what tax stuff do I have to worry about???
UGH. This is stressing me out.
Thanks!!

This might not be the best advice....but this is what i did. I gave up my apt and stored my stuff and went back to using my parents house as my permament tax home.....although i did not pay them rent or pay for annything at that residence. That is where the sticky situation comes into play. Technically in order to use your parents home as a tax home, you are supposed to pay them rent....and they have to claim it on their taxes...which kinda screws them in their taxes. SO I prayed nobody would audit me and look into it....and so far so good. And i got back each year like 6-7thousand dollars....i had my taxes done by a travel nurse tax specialist. So i did make a ton of money....but you run the risk of getting audited. You also have to keep moving around too or you run the risk of ruining the tax home status. So for instance, wherever you take this job in january.....you can only be there for 1 year and then you need to travel to another location or go home for 30 days and then you can go back....and you need to work in those 30 days, otherwise you become an itinerant worker and you get taxed like crazy from your travel company on everything!!! So just keep moving around, try and use a permanent address in your home state, keep all your mail going to an address in your home state (have your parents ship it to you) and you should be ok.

Where did you find a travel nurse tax specialist? What company? I have kind of been looking online and havent really found anything promising

The lady i went to worked out of her home, all the travelers at my hospital went to her....she lived in Carlsbad California near san diego. Her name is Anna C....she was really old and had a walker, not sure if she is still alive. But she specialized in travel nurses. there is also a company called Kobaly. They have a website with all the FAQ and info about tax home and what you can write off, what to save for receipts etc. They are a company you can send your stuff to them or do it over the phone....they are supposed to be good, but expensive. But if you've ever gone to HR block....and had to file in multiple states, it can be just as expensive so worth it to have it done by a company that specializes!

Hmm.. This year I will only be filing in IL and PA. I'm in Chicago right now. Have you or anyone you know used Kobaly? I've seen them when I googled travel nursing taxes, but I would prefer going in and seeing someone I think.

I've also seen good info here, but again, I'd like that face to face.

Tax preparation for travel nurses and mobile professionals. The Travelertax specialists

And to answer your question, I think a tax home is important. If you are nervous about using someone else's address d/t the possiblity of an audit, I say see if you could find a cheaper apt to rent? maybe sublet it out to someone you know?

Anmutasc wrote:This might not be the best advice....but this is what i did. I gave up my apt and stored my stuff and went back to using my parents house as my permament tax home.....although i did not pay them rent or pay for annything at that residence. That is where the sticky situation comes into play. Technically in order to use your parents home as a tax home, you are supposed to pay them rent....and they have to claim it on their taxes...which kinda screws them in their taxes. SO I prayed nobody would audit me and look into it....and so far so good. And i got back each year like 6-7thousand dollars....i had my taxes done by a travel nurse tax specialist. So i did make a ton of money....but you run the risk of getting audited. You also have to keep moving around too or you run the risk of ruining the tax home status. So for instance, wherever you take this job in january.....you can only be there for 1 year and then you need to travel to another location or go home for 30 days and then you can go back....and you need to work in those 30 days, otherwise you become an itinerant worker and you get taxed like crazy from your travel company on everything!!! So just keep moving around, try and use a permanent address in your home state, keep all your mail going to an address in your home state (have your parents ship it to you) and you should be ok.

The above advice is VERY illegal, and I hope everyone will refrain from following it!

If you do not have a tax home, any money your company pays for your rent, utilities, etc will be considered taxable income. For example, when I traveled, I did not have a tax home. So, my company paid for my housing, utilities, and travel reimbursement, and then I usually ended up having an extra $200-300 or so in taxes taken off my checks each month. For me, this was the better deal, because I was still getting more than I would have if I were paying $600-700/mo. in rent.

I stored most of my things (furniture, etc.) at a family member's home, and had my mail sent to a family member's house- they then put it all in a big envelope & mailed it to me wherever I was once a week.

In order to legally consider a family member's home a tax home, your family member would need to have you sign a lease, the rent needs to be enough to be comparable to the standard rates in your area (i.e., you can't pay them $50 a month & call it rent), you need to actually PAY then the rent, and then they need to claim said rent as income on their taxes.

Just "hoping" you don't get audited is a huge risk. Travel nursing in general puts you at risk for audit due to the nature of filing in multiple states, moving frequently, non-traditional deductions, etc. IF you were to follow the ILLEGAL advice given previously and either you or your family member got audited, both you AND your family member could be facing huge fines (up to $250,000) and/or up to 5 years in prison. This is so not worth the risk. Just pay the taxes!

There are 2 companies that I know if who specialize in taxes for health care travelers:

Tax preparation for travel nurses and mobile professionals. The Travelertax specialists

or

Kobaly.com - Your Healthcare Traveler Tax Specialists!

Even if you don't use these sites to do your taxes, they still have a lot of useful articles & other information on them. Contrary to popular belief, you CAN do your taxes yourself when you are a traveler. It's a little tricky (one year I had to file in 5 different states), but it CAN be done! :)

I am VERY bad with numbers, and all that stuff that comes with taxes... Did you use any do it yourself tax things? Taxes make me nervous, especially with all the 'technical' language they use. (prob how most people feel about medicine.) Did you do deductions? and did you end up paying or receiving a refund? Sorry for all the questions, but this stresses me out!

I am also horrible at math! I use TaxACT, and even with federal + 5 states, it was under $100. They pretty much walk you through everything.

I do not itemize my deductions, because I don't have enough to make it worth it. And honestly, unless you own a home, own your own business, donated thousands to charity, or have thousands of dollars in medical bills, it's usually not worth it. Other than these things, what else would you have for deductions? If you don't have a tax home, you can't deduct travel expenses, so you are probably better off taking the standard deduction.

In 3 years of traveling, I have always gotten a tax refund. One year I had to pay about $100 in to one state, but I got over $500 back from another, plus a federal refund, so I still came out ahead.

Cool thanks for the responses, everyone.
I don't want to take any chances or lie. My sister did just move out of her house and in with her fiance, and she wants to keep her place just incase they split up (they're off and on) ... she's offered to let us store our stuff there and pay her, but it would just be a little, not enough to probably qualify us for tax home. Plus, she wouldn't want to make up a lease and all that.
So ... I guess we'll just store our stuff.
Amanda ... was it 200-300 per check or per month??
I'll have to pay almost 200 for storage ... my rent was 670. So between storage cost and taxes .. I wonder if it's worth it to not keep my place?
As long as I'm not paying as much or more as I would keepng my place here thats all I really care about. My boyfriend is traveling with me, so I'll have to make enough to support us both now.
And are the travel companies going to want to work with me less if I don't have a tax home???? Doesn't it save them money, too?

AmandaWIRN wrote:I am also horrible at math! I use TaxACT, and even with federal + 5 states, it was under $100. They pretty much walk you through everything.

I do not itemize my deductions, because I don't have enough to make it worth it. And honestly, unless you own a home, own your own business, donated thousands to charity, or have thousands of dollars in medical bills, it's usually not worth it. Other than these things, what else would you have for deductions? If you don't have a tax home, you can't deduct travel expenses, so you are probably better off taking the standard deduction.

In 3 years of traveling, I have always gotten a tax refund. One year I had to pay about $100 in to one state, but I got over $500 back from another, plus a federal refund, so I still came out ahead.

Ok, cool so even without a tax home I can save receipts on certain things that will be deducted??? Did you always travel with no tax home?? and you still made quite a bit?

I ended up paying $200-300 extra in taxes per month (not every week), so it was still less than paying rent, plus with the higher hourly rates, I still made quite a bit. I also didn't have to pay for storage, though, as my family let me store things with them for free. If you want to keep an apartment, you could also just get a cheaper apartment (like a studio), and then you could store your things there, plus you'll have a place to stay if you want to spend time near home.

As far as the deductions, if you take the standard deduction you don't need to save reciepts. If you itemize, you will need to save reciepts, but you will only be able to deduct the things you would as a non-traveler (charitable donations, medical bills, etc.) If you don't have a tax home, you cannot deduct travel-related expenses.

I have never had a company tell me they didn't want to work with me because I don't have a tax home. They make the same $ whether you do or not, it only affects how much you pay in taxes. Just tell them you don't qualify for any "tax advantage" programs. If they refuse to work with you, or refuse to take the extra taxes off your check, then find a company that will. I was with RN Network the entire time, and they never gave me any problems about it.

AmandaWIRN wrote:I ended up paying $200-300 extra in taxes per month (not every week), so it was still less than paying rent, plus with the higher hourly rates, I still made quite a bit. I also didn't have to pay for storage, though, as my family let me store things with them for free. If you want to keep an apartment, you could also just get a cheaper apartment (like a studio), and then you could store your things there, plus you'll have a place to stay if you want to spend time near home.

As far as the deductions, if you take the standard deduction you don't need to save reciepts. If you itemize, you will need to save reciepts, but you will only be able to deduct the things you would as a non-traveler (charitable donations, medical bills, etc.) If you don't have a tax home, you cannot deduct travel-related expenses.

I have never had a company tell me they didn't want to work with me because I don't have a tax home. They make the same $ whether you do or not, it only affects how much you pay in taxes. Just tell them you don't qualify for any "tax advantage" programs. If they refuse to work with you, or refuse to take the extra taxes off your check, then find a company that will. I was with RN Network the entire time, and they never gave me any problems about it.

Cool thanks. That helps a lot! I think I was freaking out and overcomplicating it. It just took a little clarification.

Another question for you...If I have a tax home(and I do) , and I am doing my own taxes, what exactly can I deduct and is it difficult? I am assuming I deduct my housing that they provided? and the travel reimbursement? If I get the Tax ACT will it prompt me to deduct these? Or do I go with the standard deduction instead?

You can't deduct your travel housing unless you are paying for it yourself. If your company provided your housing, paid for it, and you didn't pay taxes on it, then it's not really a deduction. Travel expenses can be deducted, and would be treated just like deductions for other "business-related" expenses. I am NOT a tax professional- just speaking from my experiences. If you're unsure, contact a tax professional.