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You are here: Experts > Business > Corporate Law > Tax Law (Questions About Taxes) > Working/Living out of state
Expert: Ivan Roth
Date: 8/28/2008
Subject: Working/Living out of state
Question
Ivan,
I own a house in Alabama where my wife and children currently are. I am starting to work on a temporary contract basis(that will be lasting under 12 months) for an engineering firm in Houston, Texas. I will be traveling home about every five to six weeks for the weekend via airplane. In the past when I have worked outside of a 50 mile radius from my home(but still inside Alabama), the contract agency would break out per diem from my pay. The current company I will be working for does not provide this service. What is deductible(rent, utilities, food, travel expenditures home) and what documentation, receipts, bills, etc. do I need to keep up with to be able to take a deduction? Is this a standard deduction (std. dollar amt. X no. of days in Houston) like if I was being paid per diem upfront or just based on my actual expenditures I would produce receipts for during this period? Also, should I be getting Alabama State Tax withheld if I am actually temporarily residing in Texas and all the work is performed and paid for in Texas since Texas has no state tax? Even the contract agency doesn't know. You would think I was the first one to ever be in this situation.
Best Regards,
David
Answer
Hi David you could use the per diem rules (that is the amount the federal government allows as expenses to its employees in the Houston area I estimate it to be aprox 200 to300 dollars per day) of course the airline tickets would be deductible separately these items are not part of deductions but are direct reductions of income use form 2106 at www.irs.ustreas.gov
Please be sure to look up the instructions for form2106 Employee Expenses at www.irs.ustreas.gov also the form dicuses the per diem rules and where to find the information
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