Tax Considerations for Healthcare Traveler Expenses

April 12th, 2012 1 Min read Tax Considerations for Healthcare Traveler Expenses Blog
When an employee travels for business purposes, the employer typically pays for the travel costs, either directly, through expense reimbursement, or in fixed dollar allowances. These costs might include airfare, mileage reimbursements, rental cars, temporary lodging, and meal per diems. In order for these travel expenses to be considered tax-free to the employee, the employee must be traveling for business purposes and must meet three criteria:
  1. They must maintain a tax home
  2. They cannot be commuting from that tax home or be working within commuting distance of the tax home, and
  3. The assignment must not be expected to last longer than one year.
If the employee is working within commuting distance of their tax home, no travel expenses will be paid by a typical agency since the employee is not considered to be traveling. If the employee does not maintain a tax home or the travel assignment is expected to last more than one year, travel expenses will be paid; however, the value of these expenses will be considered taxable income to the traveler and all applicable payroll taxes will be withheld. More information can be found on these subjects in CompHealth's Career Resources.