permanent tax resident

Asked December 17, 2016, 2:59 PM EST

I just accepted a traveling nurse position. Will I qualify for a permanent tax resident? The form I have to fill out asks if I pay a fair value rent for my current address while I am traveling. I don't know if I pay fair value for rent. I don't think I do. I currently live in a 5 bedroom 2 bathroom home that I rent. My mother and my brother lives with me and we split rent. Our rent is $1500/month. My portion is only $500/month. The lease is under my name, but my mom and brother is also listed on the lease. For tax purposes, will this qualify my current address for a permanent tax resident? I get a housing stipend for my traveling job and I'm trying to figure out if I would be responsible or taxes. I was told I wouldn't be as long as I had a permanent address.

Summit County Ohio

1 Response

Thanks for your question. I wasn't sure but found the following guidance from Nursepro:

The IRS criteria used to determine whether you are maintaining a permanent tax residency is as follows:

  1. There must be a realistic expectation that you will return to live at your permanent tax residence and your permanent tax resident must be separate from your temporary resident; and,
  2. You must be paying to maintain your permanent tax residence while you are on assignment (i.e., rent, mortgage, room and board); and
  3. Generally, you must meet at least one of the following criteria:
    1. You live at your permanent tax residence prior to your current employment, or
    2. You have a family member utilizing this residence, or you utilize it frequently for the purpose of your own lodging.

The permanent tax residence must be your habitable living quarters and should be at least fifty (50) miles apart from your temporary residence. Payment to maintain your permanent tax residence must be real and substantial.

The IRS considers employment away from home in a single location that exceeds one year to be indefinite, not temporary.

I hope this provides some guidance. Regarding the fair value for rent, I don't find anywhere that you can't be sharing some place. There are three of you living there paying a "real and substantial" rent (meaning it isn't your parents charging you $1/month) and you have equally split the rent.

If you have serious concerns, consult with a tax preparer. If it eases your mind, it should be worth the one time consult charge.