Generally, you can only deduct the cost paid for a hotel stay in connection with travel outside of the general vicinity where you live. According to IRS Publication 463:

"You are traveling away from home if:

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."



If you continue to work at hospitals near where you live, and the schedule you work at the hospital furthest from your house does not allow you to commute back and forth between your home and that hospital and still get adequate rest, then it sounds as if you would have a good argument to support claiming the cost of the hotel as a deduction.

For more information on this deduction, check out IRS Publication 463 available at www.irs.gov.

Zip Code: 01801

Andrew, you asked the person whether he/she was a fellow. I'm a resident (with just one income) but will be a fellow next year (July 07-June 08), at the same hospital and in the same program. Will my one-year fellowship be considered "temporary position"? If so, are there enough tax advantages which warrant detailed advice from a tax professional such as yourself? Up till now I've had just simple needs so I did my own taxes each year. Thanks very much in advance. Chris

Zip Code: 02114

To qualify for the temporary job site deduction, you must take a job outside the general vicinity of where you live and work now, with the intent of returning back to that city upon the completion of the short-term job assignment. Another requirement is that the job lasts for less than one year. So if you'll be starting a fellowship at the same hospital where you're doing your residency, you won't be eligible for this deduction.

If you're free on January 31st, try to attend our annual talk at the Brookline Holiday Inn at 6 pm. I always do a segment on moonlighting and deducting professional expenses, which includes information about the temporary job assignment. This year we have 8 other people speaking on various tax and basic financial planning topics. Shortly, we'll put up info about this year's talk at www.mdtaxes.com/meeting.html

Zip Code: 01801

Thanks for the quick response, Andrew. I look forward to the meeting details and will try to be there. BTW I think there may be a market (esp among med students, interns, residents, fellows who are do-it-yourselfers) for a book on "MD taxes." Just did a search on Amazon and found none. If you ever write one, let us know! (Of course, please make the book easy to understand and affordable.)

Zip Code: 02114