Tax home for travel nurse

[cas16]

I will be living with my parents while picking up a travel nursing contract. Therefore their home would become my permanent address. In order to qualify for tax-free stipends while I pick up a travel nursing contract  several hours away I need to maintain a tax home. Would my parents home count as my tax home since I will be living there in between contracts?  The IRS says I need to duplicate expenses which is very vague, does that mean paying a few utilities in my name will count? or would shared expenses be another option such as paying an amount towards the home expenses each month and how would you calculate that?

[BillM223]

"Would my parents home count as my tax home since I will be living there in between contracts?  "

Yes

Will you be paid as an employee or as a contractor? If as an employee, the rest is easy - your home arrangements won't matter. 

As you know these are the tests for a tax home:

"There are three objective factors used to determine the bona fide nature of a taxpayer’s assertion that the claimed abode is the “regular place of abode in a real and substantial sense”: 

1. Whether the taxpayer performs a portion of the business in the vicinity of the claimed abode and uses such abode (for lodging purposes) while performing such business there; 

2. Whether the taxpayer’s living expenses incurred at the claimed abode are duplicated because business requires the taxpayer to be away therefrom; and 

3. Whether the taxpayer 

a. has not abandoned the vicinity in which the historical place of lodging and the claimed abode are both located; 

b. has a member or members of the family (marital or lineal only) currently residing at the claimed abode, or 

c. uses the claimed abode frequently for purposes of lodging."

It is not required that you have all of these in equal measure but merely that the preponderance of evidence is in your favor.

If you go home on a regular basis between contracts (one court case suggested at least 30 days a year), then you satisfy 3.c.

Clearly, if you live with your parents, you satisfy 3.b.

Do you intend to have your mail sent to your parents' home? Do you intend to file your tax return using your parents' address? That satisfies 3.a.

When you are at home, what thing do you pay for? Rent (such as it is), food, meals, car payments? The IRS, as you have seen, does not make clear distinctions here, but I would suggest that whatever you do, put it in writing, "In order to help Mom & Dad stay in that house, I will pay for X, Y, and Z."

As for #1, Do you ever need to take training, like to stay certified? Where are you when you do this? At home? All the better.

You might also want to read this article by KPMG.

[cas16]

My wife will be an employee of a travel nurse agency.  I think we have no issue fitting requirement 3 of the tax home.  As for duplicating expenses is where we are concerned.  Of course we are trying to save as much money as possible. We will be renting a location in the city of the 3 month job contract while still paying a couple of utilities at her parents house.  Would that satisfy duplicate expenses?   Let’s say those utilities are 300$ a month total.  Or do we have to pay a price of fair market value?   So hard to decipher since irs is very unclear as to what “duplicate expenses” are? 

[MarilynG]

It is expected that while on a 'temporary work assignment' you will have to pay expenses where your temporary assignment is, and also to continue to pay expenses at your 'tax home' (hence the 'duplicate expenses' requirement).

It doesn't matter what the expenses are that you pay at your parents home (you don't have to report those), just that their home qualifies as your 'tax home'. 

In addition to the details provided by @BillM223, here's more info on What Is a Tax Home?