Your tax home is the general area of your main place of business, employment, or post of duty, regardless of where you maintain your family residence. It is the location where you regularly conduct your work or business activities. If you have more than one place of work, your tax home is generally the location where you spend the majority of your working time or the place that has the strongest connection to your income-earning activity. If you do not have a regular or main place of business due to the nature of your work, your tax home is the place where you regularly live.
Determining Your Tax Home
Main place of business or employment: Your tax home is the general area where you regularly perform your work or business. This is typically the location where your principal place of business or employment is located.
No regular place of business: If you do not have a fixed or regular place of business, your tax home is generally the place where you regularly live, provided you maintain a regular residence.
No regular business or residence (itinerant): If you do not have a regular place of business or a regular residence, you are considered an itinerant. In this case, you are treated as having no tax home, which generally means you are not considered to be traveling away from home for purposes of deducting travel expenses.
Special Cases and Exceptions
Foreign Earned Income Exclusion (FEIE): To qualify for the foreign earned income exclusion, you must have a tax home in a foreign country (or countries) throughout your period of bona fide residence or physical presence abroad. In addition, you must meet either the bona fide residence test or the physical presence test.
Foreign assignment considerations: If you are temporarily assigned to work in a foreign country, your tax home may remain in the United States if your business ties, employment expectations, or living arrangements indicate that your assignment is temporary rather than indefinite.
Military and government personnel: Special rules may apply in determining tax home status for members of the U.S. Armed Forces and certain government employees stationed abroad, depending on duty assignment and applicable IRS rules.
Tax Home vs. Personal Residence
Your tax home is not necessarily the same as your personal or family residence. Your family home is where your personal and domestic ties are located, while your tax home is determined based on your principal place of work. Living expenses at your tax home are generally not deductible. Travel expenses may only be deductible when you are traveling away from your tax home for business purposes under applicable IRS rules.
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Disclaimer: Always verify with current Federal or State Department of Revenue Forms and Instructions. This information is for general guidance and may not apply to your specific situation. For complex tax matters, consult a CPA or tax attorney.