Left Home to Seek Work

[RayT]

Client was an unemployed electrician in WA, no work in WA. He was able to locate a job in the North Dakota oil strike and accepted. He drove his pick up to ND and rented a hotel room for the first month of work. Thereafter, the company provided lodging. He flew home for Thanksgiving holiday & returned to work. Since he was not a W-2 employee (1099 Self-Employed Contractor), I'm assuming his travel, lodging, meals and incidentals are all "business expense" and deductible. Am I on the right track? Comments appreciated.

[geekgirldany]

You have to figure out his tax home. A taxpayer's tax home is the vicinity of the taxpayer's regular or principal place of business, regardless of where his family home is maintained.
(Edit: Temporary or indefinite time also needs to be considered).

So, in my opinion none of the expenses would be deductible because North Dakota is considered his tax home. I am speaking to the specific expenses you mentioned. Unless there are other expenses he incurred in his tax home while subcontracting.

[Burke]

He would be entitled to moving expenses, but only if he permanently established his residence in ND, since he moved there to take a new job. He would have to meet the time and distance tests.

[Maribeth]

Also, how long was the job? Is it on-going or was it temporary. That would impact your answer also.

[BOB W]

Expecting it to last less than a year or more than a year factors into your question. Less than a year, all expenses get deducted except travel home for holidays. More than a year, he has changes his tax home and only moving expense count.

[ChEAr$]

There are many preparers I've heard of who think that a 1099-misc gives carte blanche to deduct EVERYthing, esp meals and lodgins and mileage.