On Mar 13, 2:40*pm, "Gene E. Utterback, EA, RFC, ABA"
<g...[at]alliancetax.com> wrote:
- quote -

I am in the same situation as the client discussed in this post. I
just want to ask some questions to further my understanding of this
topic. I am an engineering student. And it says that we don't
rationalize things the right way when it comes to legal/financial
issues.

Let's assume that her tax home is her parents house. Is it sufficient
that her parents claim her to make her parents' home her tax home?
Under the conventional definition of tax home in publication 463, the
tax home is where she conducts her regular business. If she has no
place of business she has to satisfy at least 2 of the 3 conditions
listed.
1) perform part of her regular business in her tax home
2) duplicate living expenses
3) have not abandoned the area of her main home

As a student, I don't think she performs a regular business around her
parents home. She also wouldn't have duplicate living expenses
(similar to the itinerant worker that lives with his sister used in
example 2 in pub 463).

Now, what would happen if her main tax home is considered to be the
university? Unless being a student constitutes a regular business. She
might not qualify for the standard definition. For the second
definition of tax home, the only way I envision her qualifying is if
she kept paying rent and utilities while she was gone for the
internship to qualify for duplicate living expenses.

Like I said, I am in the same situation as above, the only difference
is that nobody can claim me. I also put all of my stuff in a storage
while I was away for the internship (would this qualify as duplicate
living expense?). I have a job at the university (research assistant
at least 1/2 time). However, supposedly, its purpose is to further my
education. So I am not sure if it count as a regular business. Also, I
can demonstrate my attachment to my local tax home while I was away. I
spent a substantive amount of money for flying back and forth. and
spent a substantive amount of money to move back and forth for the
internship purpose.

Thanks for your help.

--
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"Frank S. Duke, Jr." <dukefs[at]one.net> wrote in message
news:C5DF9B70.125CA%dukefs[at]one.net...
- quote -

With the usual caveat that without seeing all the documentation you can't
really rely on this - this is likely what I would do.

I saw another response that suggested that she may be a transient worker and
I disagree with that assessment. IMNHO, her tax home, especially if her
parents are claiming her, is her tax home. And should they not be claiming
her then I'd say her tax home is at the University where she intends to
return after these temporary assignments.

Don't forget all the state returns too!

Gene E. Utterback, EA, RFC, ABA

--
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On Mar 13, 2:11 am, "Frank S. Duke, Jr." <duk...[at]one.net> wrote:

- quote -

She might be a transient worker and her travel expenses might not be
deductible. This was being discussed in the recent thread "Employee
expenses". The IRS publication is 463 and they say

<Quote source="http://www.irs.gov/publications/p463/
ch01.html#en_US_publink100033754"If you do not have a regular or main place of business or post of duty
and there is no place where you regularly live, you are considered an
itinerant (a transient) and your tax home is wherever you work. As an
itinerant, you cannot claim a travel expense deduction because you are
never considered to be traveling away from home.
<Quote
So I think the key is whether she has a home office. But see "Factors
used to determine tax home" in the same link above.


- quote -

She was paid as a W2 employee in the other jobs?


- quote -

Seems to be she might be a transient worker. However, I wonder if she
could describe herself as moving from place to place, and so claiming
a moving expense deduction (food is not allowed). However, she
returns to her primary residential home, so this probably would not
work.

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Client is a 3d year college student at the University of Cincinnati. She
does co-op work 2-4 months per year in conjunction with her architecture
studies. So far, she has worked in Louisville, KY, Columbus, OH and
Chicago. She has a home with her parents in Cincinnati and an apartment at
the University but on each of these jobs, she has to pay her own room, board
and expenses in the distant city.

On the Chicago job, she was paid as an independent contractor and it
occurred to me that she could lessen the impact of the SE tax if she
deducted her travel and housing expenses. If I took a 2 month temporary
assignment in Chicago, I would see no reason why I could not deduct such
expenses.

Likewise, she should be able to take the same expenses for her other jobs as
employee business expenses subject to the 2% limit.

Does anyone see anything wrong with this? It is a temporary absence from
her tax home, more than 50 miles, for the purpose of employment. It seems
like all her travel, housing, meals, and local transportation should be
deductible.

Uncompensated advice guaranteed correct or double your money back

Frank S. Duke, Jr. CPA
Cincinnati, OH USA

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >