I am currently a fellow at the Hospital of the University of Pennsylvania in Philadelphia. My fellowship started in 7/1/2006 and ends at 6/30/2007. Prior to this fellowship, I had been at NYC, finishing up my residency at the Columbia University Medical Center. After my fellowship ends in 6/30/2007, I will head back to NYC, where I will start working at a job that starts at 7/1/2007. I had rented an apartment when I was living in NYC, so I do not have a home in NYC for which I've had to pay expenses. My question is, are my living expenses in Philadelphia (i.e. lodging and food) tax deductible as part of a "temporary job assignment." Thanks you.

Zip Code: 19103

Sounds to me like you qualify for the temporary job assignment deduction. As long as you have a signed contract in hand, you can prove that you intend to return to NY upon your completion of the one year fellowship in Philly.

We get this question a lot on this message board, so if you have some time please scan through our other answers to questions about Temporary Job Assignments.

Zip Code: 01801

Hi,

I too just accepted a one-year fellowship in New york, starting on July 1, 2009. I will finish my residency in Los Angeles on June 30, 2009. I have just accepted a position to return to Los Angeles as an attending at my current residency program after completion of my one-year fellowship.

My question: in terms of documentation, is it enough that I have a contract that specifies a one-year fellowship to document my temporary assignment was "one year or less?" OR...do I need to specify in my contract for the Los Angeles position that I need to start on July 1, 2010? I'm not sure if my Los Angeles job would be ready to take me until around August 2010. In other words, does "temporary" job assignment entail that there is no lapse in time when returning back to Los Angeles after the fellowship?

A related question would be: would it be enough (in addition to a fellowship contract specifying a one-year term) to show airplane tickets returning to Los Angeles dated July 1, 2010 to document intention to return back to L.A.?

In general, I'm just not sure what documentation would suffice. Any clarification would be greatly appreciated.

Thanks,
Bob

Check out IRS Publication 463 at: http://www.irs.gov/publications/p463/ch01.html, and click on the link for Temporary Assignment or Job.

This publication focuses on the temporary assignment lasting for a period of one year or less. Please note that if you decide to remain at your temporary job for any time after July 1st, then the job no longer qualifies as termporary as of the day you make that decision, since the assignment would last for more than one year.

Based on my understanding of the rules, I would say that if you have a signed employment contract that brings you back to where you were living and working prior to the temporary assignment, that should do the trick - even if you won't be starting until August 1st. The signed contract would go a long way to substantiate your intent.

If you get audited, you would need to show the one-year contract for the NY job, the signed and dated contract for the LA job, and your travel dates during the year. I would think the IRS might also want to see documentation of any return trips to LA during your year in NY.

Have a great year in NY.

Zip Code: 01801

Thanks for the helpful reply.

Another related question/twist:
If my spouse's work provides a relocation package that makes it favorable to purchase a home in New York during my one-year fellowship, would we be able to deduct the mortgage interest twice (one for the usual mortgage interest deduction and again for lodging expenses during a temporary job assignment)?

Also, do you think that the actual purchase of a home might mitigate the case of establishing intent of moving back to our original home (Los Angeles) despite having a contract to return to Los Angeles prior to the start of the fellowship?

Thanks again