Being temp reassigned for 1 to 3 years (decided annually). Considered "on loan", but still employee of current employer. Is employer paid housing considered income?

[pbolin1]

Still considered an employee of current employer, and keeping local house as primary residence.  Will be coming back a minimum of 4x per year but employer will be paying for all housing expenses in reassignment location.  Need to understand tax consequences of the assignment.

[Carl]

If it's not included on your W-2 or some other tax reporting document, you don't need to concern yourself with it.

[TaxGuyBill]

Although not common, if you are living in the business facilities (or occasionally certain "camps" provided by the employer), that is usually a tax-fee benefit (assuming it meets a couple of other requirements).
<a rel="nofollow" target="_blank" href="https://www.journalofaccountancy.com/issues/2015/jul/exclude-employer-provided-meals-and-lodging.htm...>
<a rel="nofollow" target="_blank" href="https://www.law.cornell.edu/cfr/text/26/1.119-1#b">https://www.law.cornell.edu/cfr/text/26/1.119-1#b...>

If that does not apply, then as Opus said, the lodging would be taxable if it is on an assignment of 1 year or more.

[Opus 17 · Accepted solution]

Here's the rule:

If you travel away from your tax home for a temporary job assignment, you can deduct the cost of your travel, lodging, and half the cost of your meals or half the federal per diem rate for meals for the area where you are working.  If you are in a situation where you could deduct the expenses, then they could also be provided as a tax-free benefit by your employer.  (If you receive a tax-free benefit, you can't also take a deduction.)

Temporary means expected to last AND actually lasting less than 1 year.  If an assignment is indefinite (undetermined) or if an assignment is originally expected to be short term and then lasts longer, then none of the expenses are tax deductible or eligible for tax-free treatment.

So if you are "temporarily" assigned to another location but there is no definite end date and it might continue year over year, then the assignment does not qualify for the tax deduction even if you actually end up working there less than 1 year.  Your employer should include the value of any housing or travel allowance as part of your taxable wages and deduct income tax withholding and social security and medicare tax, and should include the value of the allowance as part of your W-2 box 1 wages.  You would not be eligible for the tax deduction.

(I disagree with Carl that you only need to be concerned if the allowance is in your W-2.  If it is not, but should be, then you could possibly get away with not paying the tax, but your employer is breaking the law and you both could get hit for back taxes and penalties if either one of you is audited.  You may want to ask your payroll person how this will be reported, and consult with a professional tax advisor if you are concerned.)