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Housing stipends help maximize your earnings while on assignments because they’re not taxed, making them one of the best parts of being a travel nurse. However, since they’re untaxed, not every traveler qualifies for stipends, and that’s where confusion often occurs. Whether you’re new to travel nursing or you’ve never fully grasped how travel nurse housing stipends work, this comprehensive guide helps you better understand this essential part of your travel nurse salary.
What Are Travel Nurse Stipends?
Stipends are like reimbursements, except you get this money in advance instead of after the fact. The travel nurse agency adds these stipends to your taxed salary to cover housing costs while on a travel assignment.
However, you may also hear the term stipends used for per diems for meals and incidentals (M&Is), which agencies calculate separately from housing. Despite being calculated and paid out separately, if a traveler doesn’t qualify for housing stipends, they don’t qualify for M&I stipends either. It may not sound fair, but the two are tied together even if they’re paid apart.
Are Travel Nurse Housing Stipends Taxed?
No, travel nurse housing stipends aren’t taxed. Thus, if you qualify for stipends, you don’t pay income taxes on them. To be eligible for tax-free stipends, you must have duplicate expenses between your permanent tax home and another temporary home you stay at while on an assignment.
You pay income taxes on your hourly salary, so your paycheck has a blended rate of taxed and untaxed monies. Your housing stipend may be quoted as a daily, weekly or monthly rate but generally goes on the same weekly or bi-weekly paycheck as your salary.
RELATED: Dollars and Sense: Travel Nurse Salaries Explained
How Are Travel Nurse Housing Stipends Determined?
The United States General Service Administration (GSA) is an independent agency established in 1949 to help manage the basic functioning of federal agencies, including the procurement of facilities and services. The GSA also establishes the per diem reimbursement rates for federal employees who travel for official work-related purposes.
Per diem is a Latin word meaning “per day,” so per diem rates are the per-day reimbursement rate established by the GSA. It bases per diem rates on contractor-provided average daily rate data on the cost of local lodging in each of the 48 continuous states and Washington, D.C.
Why is this important to travel nurses? It’s important because the Internal Revenue Service (IRS) also uses GSA per diem rates for private citizens who travel to work away from their permanent tax homes for extended periods, like travel nurses and other traveling healthcare professionals. Thus, the GSA’s maximum per diem rates in a given location are also the maximum rates allowed for travel nurses.
Although the GSA defines three expense categories: housing, meals and incidentals, this post only covers housing. Because the cost of living varies across the country, the GSA publishes different rates for different locations. You can explore current per diem rates by city or zip code on the GSA’s website. However, the Department of Defense determines per diem rates in Alaska or Hawaii if that’s your travel nursing destination.
Travel nurse agencies can’t pay more than the maximum amount stipulated by the GSA without raising red flags. However, agencies aren’t required to pay the maximum housing stipend or even a set percentage of this maximum, though you may have heard differently.
One thing to consider is that the GSA bases its rates on short-term stays, with overnight accommodation usually in a hotel. Travel nurse contracts typically last about 13 weeks, and nurses may stay in a house or apartment under a short-term lease, which is cheaper than staying a few nights in a hotel. Even if a travel nurse stays in a hotel, most establishments offer significant discounts for extended stays.
Thus, actual housing costs for a travel nurse are usually less per day than for federal employees. The GSA simply states the maximum amount an employer can reimburse an employee without exchanging receipts. However, you must still keep receipts to prove you have lodging expenses.
How Do Travel Nursing Agencies Calculate Housing Stipends?
Now that we’ve established where the maximum amount comes from let’s explore how a travel nursing agency arrives at the stipend it pays a traveler. Each agency may have its own way of calculating housing stipends. However, each one typically considers three primary factors:
- Bill Rate
- GSA Maximum
- IRS Guidelines
Bill rates are a huge determining factor for housing stipends and the entire pay package. This rate is the total amount a healthcare facility pays the travel nurse agency for supplying them with a travel nurse to fill a specific role.
The agency uses the bill rate to cover every cost associated with an assignment, including the travel nurse’s salary and stipends, plus the agency’s own expenses and enough profit to remain in business. The larger the bill rate, the more the agency can afford to allocate for housing.
Related: Everything Travel Nurses Want to Know About Bill Rates
As previously covered, the GSA maximum is the ceiling. Some travel nurse agencies may pay the maximum if the bill rate supports it, while others might only pay a fixed percentage of the maximum on all their contracts. Still, others might pay more than the bill rate because travelers net more money if they receive additional non-taxable income, making their jobs more attractive. However, this is against the rules and will raise red flags. Keep this in mind when choosing a travel nurse agency.
The travel nurse agency also must follow Internal Revenue Service (IRS) guidelines. Per these guidelines, the agency should provide a housing stipend amount that it reasonably expects the traveler will need to cover the actual cost of housing in the area they’re working. For example, housing in Los Angeles or New York would likely cost more than accommodations in a smaller city in the Midwest. Thus, by IRS guidelines, stipends would be lower in the cities with lower-cost housing.
Average Travel Nurse Housing Stipend
Calculating an average travel nurse housing stipend is almost impossible because it varies dramatically based on many factors and between regions. However, stipends almost always cover the cost of suitable housing in the area where you’re contracted to work. In very rare cases, the stipend won’t be enough.
Although you can determine the GSA maximum in cities across the nation, this might not do you any good since the bill rate and the agency ultimately decide on the actual stipend. Instead of fixating on the stipend amount, it’s wiser to evaluate the entire pay package to better determine whether the pay is suitable for each travel nursing job.
Do You Qualify for Tax-Free Housing Stipends?
Tax-free stipends often comprise the bulk of a travel nurse’s weekly salary, so let’s run down some instances where you would and wouldn’t qualify to claim them.
First, two ways you wouldn’t qualify for tax-free travel nurse housing stipends include:
- If you take agency housing instead of making your own housing arrangements
- If you don’t duplicate housing expenses between a permanent tax home and another temporary residence while on travel assignments
Qualifying for stipends begins with establishing a permanent tax home. According to IRS Publication 463, under normal circumstances, your tax home is “your regular place of business or post of duty, regardless of where you maintain your family home. It includes the entire city or general area in which your business or work is located.”
However, due to the nature of their work, travel nurses don’t have a regular place of business. They may spend time working in many places while exploring nursing careers, so their tax home may be where they regularly live.
The IRS created a three-part test to help travel healthcare workers determine their tax home status because they don’t have a regular place of work. You must satisfy two of the following three criteria found in Publication 463 to qualify for tax-free housing stipends:
- You perform part of your business in the area of your main home and use that home for lodging while doing business in the area.
- You have living expenses at your main home that you duplicate because your business requires you to be away from that home.
- You haven’t abandoned the area in which both your historical place of lodging and your claimed main home are located; you have a member or members of your family living at your main home; or you often use that home for lodging.
If you satisfy all three, your tax home is definitely where you normally live. If you satisfy two of the three, you probably have a tax home, depending on your exact circumstances. If you only satisfy one of them, you’re considered itinerant and don’t qualify for tax-free stipends.
RELATED: What Is a Travel Nursing Tax Home?
Debunking a Housing Stipend Myth
One more important thing to keep in mind is that there’s no such thing as a 50-mile rule regarding whether you qualify for tax-free housing stipends. The IRS defines traveling away from home as:
- Your duties require you to be away from the general area of your tax home substantially longer than an ordinary day’s work, and
- You need to sleep or rest to meet the demands of your work while away from home.
Nowhere in the tax rules does the IRS set a specific distance, but you will see and hear “50 miles” many times. The travel agency or the facility where you work on contract may require travelers to live at least 50 miles away for their own reasons. A recruiter may even tell you that it’s an IRS rule, but according to several tax experts we’ve spoken with, this isn’t true.
Once you determine that you have a permanent tax home, you must complete and sign a declaration with your travel nursing agency to receive tax-free housing stipends in your pay. It’s wise to ask beforehand what you need as proof of a tax home so you can prepare any necessary paperwork.
Related: Understanding Travel Nursing Tax Rules
Do You Get Paid Housing Stipends When You’re Not Working?
Whether you get your housing stipend when you’re not working depends on why you’re not working. First, the GSA quotes daily rates because government employees generally only travel a few days at a time.
Travel nurses don’t work every day of the week, but they’re away from their permanent homes every day and usually can’t return there between shifts. Therefore, they must secure housing for the entire contract, not just the days they work. Travel nurse agencies have a reasonable expectation that travel nurses incur housing expenses every day they’re on an assignment, so they pay housing stipends every day of the week, not just scheduled workdays.
That being said, if you miss one or more shifts due to illness, unscheduled vacations or most other personal reasons, you may lose your housing stipend for those days. The travel agency doesn’t get paid for the days you don’t work, so you don’t either.
Stipends are part of your salary, so don’t expect to get that money if you call in. Agencies break down the housing stipend for the entire contract to an hourly rate, so if you miss a 10-hour shift, you’ll lose 10 hours of stipends.
However, if the hospital cancels your shift(s), you should still collect housing stipends and may even collect your entire salary if your contract includes a guaranteed hours clause. If you signed a lease and the hospital cancels a large chunk of the contract for cause, such as performance or disciplinary issues, you could be on the hook to cover the cost for the remainder of the lease. To avoid this risk, try to find month-to-month leases, stay at extended-stay hotels or use housing options with more flexible terms.
Get a jump on your housing search by checking out the Best Websites for Travel Nurse Housing for some great tips, then browse jobs on Vivian to find your next travel opportunity.
Please Note: We aren’t tax advisers, Certified Public Accountants or attorneys. We aren’t in any way providing any tax advice. All information contained within this blog regarding taxes is purely informational. Vivian always suggests seeking the advice of professional tax advisors to ensure you have the correct and most current information for your unique situation.
If I am working 400 miles from my permanent residence, working a 5 day work week and unable to travel home due to the milage to my permanent home why is the breakdown of the stipends on VIvians site only set at a 5 day payment? Is this an aspect to discuss with the recruiter during conversations or is there a different type of breakdown for a nurse so far from their permanent residence?
Hello Cara and thanks for reaching out! We would encourage you to connect with the recruiter in the Vivian chat function for specific questions about the pay allocation for a contract as each scenario is different.
If I’m on-call for 4 hours because hospital called me off, can I get my per diem?
Hello Steve and thanks for reaching out! If you’re called off, you should still receive your stipend whether you’re on call or not. However, you lose your hourly wage unless you have guaranteed hours in your contract, then you also get your hourly.
Hi Vivian and thanks for the very informative post. I’m thinking about traveling soon, I’m an Ultrasound tech, but I’m still a little confused about the housing stipend. What if I only have to pay for the house/apartment that I’m going to occupy during the contracts, since we don’t have a permanent resident or anything like that anywhere else? Can I still get the stipend?(even though is not duplicate expense) I’ve heard that in that case the agency could tax the stipend and you will not be breaking the rules? Please I’d appreciate any clarification, thank you again!
Hello Yeisy and thanks for reaching out! If you don’t have a permanent tax home and won’t be duplicating expenses, you won’t qualify for tax-free housing stipends. But the agency should include this amount in your fully taxed salary instead. You still get that money. It’s just fully taxed. You will take home less money compared to travelers in the same role who have a permanent tax home because more taxes are being taken out of your pay. But you may still earn more than those in the same role in staff positions, with the added benefit of being able to travel while still earning a paycheck. Good luck with your travels and we hope Vivian can help you find your next travel contract!
Hello, as a travel nurse do I have to stop getting stipends if I stayed in 3 different hospitals for the past year that are within a 50 mile range. How many months of break do I have to have between assignments to keep my travel rate and not pay taxes on stipends? And the most important, to not get in trouble with the IRS. Some travelers say 1 month, others say THREE months. I don’t know who to believe.
Hello Lesia and thanks for reaching out! To ensure you’re following current IRS tax rules for travelers, we always suggest talking to a tax professional familiar with the unique tax situation of travel nurses. You might also read our blog covering travel nurse taxes, in which we spoke to a tax expert at H&R Block, found here: https://www.vivian.com/community/money-taxes/understanding-travel-nursing-tax-rules/. In this post, the tax pro cautions travelers about staying too long in the same area because they risk shifting their tax home to the work location instead of their permanent home location. Consider talking to a tax professional to see what they advise based on your specific situation.
Is it true that if you work at least 6 hrs in an 8 hr shift that they are not supposed to prorate your stipend?
Hello Virgel and thanks for reaching out! This could depend on how your contract is worded. We suggest checking any section discussing missing shifts or partial shifts to see what your agreement says. Also, talk with your recruiter to see if they can provide further insight and if they can’t, talk to a tax attorney.
I’ve heard from other travelers that you cant stay longer than a year at the same facility because then you’re not eligible for the tax free stipend. Is that true? What are the rules on that? Do you have to take 28 days off in between contracts or does your requested time off during the contract count towards those 28 days? Thank you!
Hello Spencer and thanks for reaching out! Yes, it’s true that you can’t stay at the same facility for more than one year or it’s considered an indefinite assignment and you lose your tax-free stipends. Read our blog on Understanding Travel Nursing Tax Rules here: https://www.vivian.com/community/money-taxes/understanding-travel-nursing-tax-rules/ to learn more. The “How Long Can You Work in One Location Without Losing Your Tax-Free Stipends?” section should be especially helpful. This post was written with help from two tax professionals familiar with travel nursing tax rules, who state that you must follow a 12-out-of-24-months rule to stay within IRS guidelines, meaning you can’t stay in one place more than 12 months out of 24 months. We also recommend consulting with a tax professional to ensure you follow all current IRS rules to avoid an unexpected tax bill.
I was thinking about taking a second contract. I know a traveler that is working 2 contracts simultaneously just through different agencies at different hospitals. She would qualify for the stipend at either place but is it legal to collect 2 stipends. She does stay at 2 different places plus has a home residence.
Hello Melissa and thanks for reaching out! We suggest speaking to a tax professional familiar with tax rules for travel healthcare professionals to confirm whether taking two stipends would be legal. However, housing stipends cover every day you’re away from home, even when you’re not working (or working at a second job), so taking two stipends would be like getting paid twice for the same expense and could lead to tax trouble.
My current contract got rid of my guaranteed hours. I just had a shift canceled by the hospital and my contract states a $401 deduction for “missed shift” not canceled. I am also losing my hourly pay for the shift. Is my agency legally allowed to deduct that money from me? Thanks.
Hello Peter and thanks for reaching out! If your contract doesn’t include guaranteed hours, you risk losing money if the hospital cancels a shift. It sounds like a canceled shift, not a missed shift, so that might help your case. There’s a difference between the two. However, Vivian can’t provide legal advice. We can suggest speaking to your recruiter and asking them to explain how your contract works when the hospital cancels a shift. If they can’t help you, talk to an attorney familiar with travel contracts to see what the agency can legally deduct from your pay for a canceled shift based on your contract. We wish you the best of luck!
Hello
The rate I got from my recruiter are taxable wages $2,496/week (48 hr), weekly lodging allowance $847, weekly meals and incidental allowance $483. My question is do I have to show the receipt to get the allowance or the allowance will be paid to me in full amount regardless?
Hello Suchada and thanks for reaching out. Whether you must provide receipts depends on how your contract is worded. If you’re working under an accountable plan, then yes, you’d need to supply some sort of proof (receipts, bank statements, bills or expense reports) that documents your expenses to your employers. But you may get your stipends automatically without providing any proof. Talk to your recruiter to learn how your contract is set up. We also suggest speaking to a tax professional to cover all your bases taxwise. You might find our “Understanding 2022 Travel Nursing Tax Rules” blog post (https://www.vivian.com/community/money-taxes/understanding-travel-nursing-tax-rules/).
I was looking at taking a local contract at a hospital 59 miles from me. The hourly rate is $42 but that are adding a $720 weekly housing/ incidental expense stipend. They told me this $720 would be taxed.
I’ve told them I will not be duplicating my living expense as I plan to just make the hour drive each way. Am I legally allowed to take this stipend if it is in fact taxed?
I just don’t want to get in trouble when it comes time to file taxes.
Hello Samantha and thanks for reaching out! Yes, as long as it’s taxed, you can still receive it. If you were duplicating expenses, the stipend would be untaxed. Instead of receiving a tax-free stipend, the amount is added to your taxed salary. It isn’t really a stipend any longer, just part of your fully taxed wages. For more details, check out our blog post “What Is a Travel Nursing Tax Home?” (https://www.vivian.com/community/travel-nursing/what-is-a-travel-nursing-tax-home/) and “Understanding 2022 Travel Nursing Tax Rules” (https://www.vivian.com/community/money-taxes/understanding-travel-nursing-tax-rules/). When in doubt, we always suggest seeking the advice of a tax professional familiar with the unique tax rules of travel healthcare professionals to ensure you’re following current IRS rules. Good luck with your local contract!
If I take a contract close to my own home and do not have to relocate, and I have family living with me in the home, do I qualify for any type of housing stipend?
Hello Jennifer and thanks for reaching out! If you’re remaining in your own home, you wouldn’t qualify for housing stipends. You’d be considering a local traveler and the entire salary would be taxed, but this salary is still usually higher than comparable staff positions. You only receive untaxed housing stipends if you’re maintaining two homes (your permanent tax home and a temporary home you need while working away from home). Also, the assignment must be far enough from your permanent home that you can’t comfortably commute daily, requiring you to secure temporary housing near the workplace.
Hi. Currently I’m a “local contract nurse”. Sept I’m taking a real travel contract. My question is pay rates published on Vivian. I’m seeing rates around $2000 a week in the area I wish to go. My question is minimum gsa housing, mi&e combined is $157/day. So does the $2000 a week include the $1100/ week stipend? That would bring my hourly pay rate to $25/ hr?
Hello Iryna and thanks for reaching out! Some job postings on Vivian only show the blended rate (taxed and untaxed weekly pay combined), but others show the breakdown. When you open a job posting on Vivian, look in the Job Details section to see if there’s a heading that says “Estimated payment breakdown” and beneath this heading, you should see one amount under weekly taxable income and and a second amount under non-taxable stipends. For example, randomly choosing a travel med-surg job in Erie, PA, with a listed pay rate of $3,063 per week and an estimated payment breakdown, it shows $1,908 in taxable income and $1,155 in non-taxable stipends. The position says it requires 36 hours per week, so your taxed hourly rate would be $53 but your blended hourly rate (taxed and untaxed) would be around $85. Not all postings provide the breakdown, but you could use the breakdown from a comparable job to give you an idea of what the breakdown might be for the job you’re considering. In some jobs the hourly taxed rate may seem small because the breakdown includes a higher non-taxed stipend. I hope this information helps. If you have other questions about our website, please don’t hesitate to go to the “Contact Vivian” option under the Resources tab to speak with our 24/7 help desk. We’d be happy to help you!