Travel Nurse Stipends Explained: Housing, Meals, Tax Home and the One-Year Rule

A travel nurse's weekly pay is a package, not a wage: a taxable hourly rate plus untaxed stipends for housing and meals, and sometimes a travel reimbursement. The stipends are what make a 13-week contract pay more than the taxable rate suggests, and they are also where most of the confusion, and most of the tax risk, lives. This guide explains what a stipend is, why it can be paid tax-free, the rules that decide whether yours qualifies, how much it can be, and how to compare a package honestly with a staff job. The rules are the Internal Revenue Service's own, from Publication 463, read in October 2026.

What a travel nurse stipend is

When an employer sends you to work away from home temporarily, the extra cost of living in two places at once, a hotel or a rented room plus meals, is a business expense. The IRS lets an employer reimburse that expense without treating the money as wages, as long as the reimbursement follows what the IRS calls an accountable plan. A travel nurse stipend is exactly that: a per diem allowance for lodging and for meals and incidental expenses (M&IE), paid by the agency for each day you are away from home on the assignment.

A typical weekly package therefore has three parts:

• Taxable hourly wage: the part that appears as wages on your W-2, with income tax, Social Security and Medicare withheld.
• Housing stipend and M&IE stipend: per diem allowances that are not taxed when you qualify (below). Some agencies offer agency-arranged housing instead of the housing stipend.
• Travel reimbursement: a fixed amount for getting to and from the assignment, usually paid in the first and last weeks.

Agencies often advertise the sum of all three divided by contracted hours as a "blended" hourly rate. That number is useful for comparing packages, but it is not your wage, and nothing about it is guaranteed by the tax code. Whether the stipend part is really tax-free depends on you meeting the IRS tests, not on how the agency labels the money.

Why a stipend can be paid tax-free

IRS Publication 463 sets three conditions for an accountable plan. Your reimbursement is not reported as wages only if all three hold:

1. Business connection: the money reimburses a deductible travel expense you incurred while working for the employer, which for a travel nurse means lodging and meals while away from your tax home on a temporary assignment.
2. Adequate accounting: you account to the employer for the expense within a reasonable time. For per diem allowances at or below the federal rate, the agency's records of where and when you worked are the accounting; you do not have to keep meal receipts.
3. Return of any excess: an allowance you received for days you did not travel has to be paid back within a reasonable time, or it becomes wages.

Two of these are the agency's job. The first is yours, and it is where a package can quietly turn taxable: if you are not actually traveling away from a tax home, there is no business expense to reimburse, and every dollar of "stipend" is ordinary income that should have been taxed. The IRS is explicit that if an assignment is indefinite, "you must include in your income any amounts you receive from your employer for living expenses, even if they are called travel allowances."

The tax home test

Everything turns on having a tax home that you are away from. The IRS defines your tax home as your regular place of business, the whole city or general area where you normally work, regardless of where your family lives. A nurse who works a staff job in Columbus and takes a 13-week assignment in Phoenix is plainly away from home.

Travel nurses who no longer have a regular job back home are judged on three factors instead. According to Publication 463, if you have no main place of work, your tax home is where you regularly live only if:

1. you perform part of your work in the area of your main home and use that home for lodging while working there;
2. you have living expenses at your main home that you duplicate because the work requires you to be away from it; and
3. you have not abandoned the area: you keep your historical lodging there, family members live there, or you often stay there.

Meet all three and your tax home is your residence. Meet two and the answer depends on the facts. Meet one or none and the IRS treats you as an itinerant: your tax home is wherever you happen to be working, you are never "away from home," and no stipend you receive is tax-free. In practice, factor 2 is the one that matters: you have to be paying for a home you keep while you pay for lodging on assignment. Letting the lease go and living out of assignment housing full time is the most common way a travel nurse loses the tax-free stipend without noticing.

Note what the rule does not say. There is no distance test in Publication 463; the "50-mile rule" that circulates among travelers is an agency policy, not a tax rule. What the IRS requires is that your duties keep you away from your tax home substantially longer than an ordinary day's work and that you need to sleep or rest away from home to do the job. An assignment close enough to commute from your own bed does not generate a lodging expense, and a lodging stipend paid for it is wages.

The one-year rule

A stipend is only tax-free while the assignment is temporary, and the IRS defines temporary with a clock: an assignment in a single location is temporary if it is realistically expected to last, and does last, one year or less. One that is expected to last more than a year is indefinite from the start, whether or not it ends up running that long, and the assignment location becomes your new tax home.

Three details from Publication 463 matter for travelers:

• Expectations count, not just outcomes. You decide whether work is temporary or indefinite when you start it. A contract that is extended again and again can become indefinite once it is realistically expected to pass the 12-month mark, and the stipends from that point are taxable even if the agency keeps paying them untaxed.
• A probationary hire is indefinite. Taking a job that requires you to move, with the understanding that you keep it if your work is satisfactory, is an indefinite move; nothing paid for meals and lodging during the probation period is excludable.
• Days off at home do not count as travel. If you go back to your tax home on days off, you are not away from home while you are there, so the stipend covers your assignment lodging and the trip, not the days at home.

The year applies to a single location, so most travelers manage it by rotating facilities and metro areas. The IRS publication does not prescribe a minimum gap between assignments in the same place, only that the next assignment there is realistically expected to end within the year.

How much a stipend can be

The ceiling for a stipend paid without receipts is the federal per diem rate for the place you sleep. The General Services Administration sets those rates for every county in the continental United States each October, and the IRS lets an employer reimburse up to them with no expense records beyond time and place. Publication 463 spells out what happens above the line: an allowance higher than the federal rate is not something you have to pay back, but "the difference will be reported as wages on your Form W-2" unless you substantiate your actual expenses.

The standard rate covers most of the country; 295 non-standard areas, mainly large metros and resort counties, carry higher lodging rates, and in some the rate changes with the season (Phoenix is a high-cost locality only in February and March, Los Angeles and San Francisco all year). The IRS high-low method is a simplified alternative some employers use instead of county-by-county rates: $329 a day in listed high-cost localities and $230 everywhere else, of which $86 and $74 respectively count as meals.

On a seven-day week the standard rate alone is $1,267, and a high-cost locality under the high-low method is $2,303, which is why stipends make up such a large share of a travel package. Two consequences follow. A stipend that exceeds the rate for your assignment county is partly wages, however the pay sheet labels it. And a stipend well below the rate is not a bargain for you: the money the agency did not pay as stipend is money it is keeping, not money it is paying as wages.

Travel nurse pay versus staff pay

No government survey measures travel nurse pay separately, because a travel nurse is a registered nurse paid on a short contract; the Bureau of Labor Statistics counts the job, not the contract. The staff benchmark it does publish is the Occupational Outlook Handbook's 2025 median pay for registered nurses: $97,550 a year, or $46.90 an hour. A travel package is quoted per week and moves with demand, so the only fair comparison is to convert both to the same unit and account for what the stipend is and is not.

To compare a package with a staff offer:

1. Convert the package to an hourly figure: weekly taxable wages plus weekly stipends, divided by contracted hours (36 is typical). Then separate the taxable part, because only that part is comparable to a staff hourly rate before tax.
2. Price the stipend at what it actually buys. The stipend reimburses duplicate housing and meals. If you keep your home and rent on assignment, the money is largely spent; if you can stay cheaply, the surplus is real, tax-free income.
3. Check what the taxable rate drives. In most contracts overtime, holiday premiums, sick pay and any retirement match are calculated on the taxable hourly wage, not on the stipends, so a package built on a very low taxable rate and very high stipends pays less than it looks the moment you work extra hours or miss a shift.
4. Count benefits and the gaps. Staff positions carry paid time off, employer-paid health coverage and continuity; travel contracts carry agency benefits that often lapse between assignments, plus unpaid weeks between contracts, licensing costs in non-compact states and travel.
5. Remember what the stipend does not do. Tax-free income is not reported as wages, so it does not count toward Social Security earnings, and it does not appear on the pay stubs a lender reads when you apply for a mortgage.

Done this way, a package can beat the staff median by a wide margin during a shortage and fall below it when demand cools; the stipend is the lever that moves, which is the point of the whole structure. Our guide to the highest-paying nursing jobs explains why no fixed travel figure is printed, and the highest-paying states for nurses gives the staff wage in every state you might travel to.

Questions to settle before you sign

• What is the taxable hourly rate, on its own? Ask for the taxable wage, the housing stipend, the M&IE stipend and the travel reimbursement as four separate lines, not a blended number.
• What happens to the stipend if a shift is cancelled or you call out? Stipends are paid per day away from home, but many contracts reduce them when contracted hours are not worked; get the clawback in writing.
• Does the stipend match the county rate? Look up the federal rate for the assignment's county and compare. Above it, expect part of the stipend on your W-2; far below it, ask where the difference went.
• How long is the assignment expected to run, extensions included? The one-year rule is about expectations at the start, so an open-ended "we will keep extending you" is the answer to listen for.
• Do you still qualify? Keep paying for a home you return to, keep the lease or mortgage, utilities and travel receipts, and keep working or staying there between contracts. These records are what prove a tax home if the question is ever asked.

Licensing and where the assignments are

A multistate license under the Nurse Licensure Compact lets a nurse whose primary residence is in a compact state take assignments in every other compact state on one license; see our compact nursing states list and, for the non-compact states, how to transfer a nursing license to another state. Most agencies advertise assignments as travel contracts, but hospitals also post their own short-term and contract positions; the registered nurse jobs on our board list the employer and the location for each, and the state pages (California, Texas, Florida, New York) let you see where the openings are before you commit to a license.

Sources

• Internal Revenue Service, Publication 463 (2025), Travel, Gift, and Car Expenses: tax home, temporary assignment or job, accountable plans and per diem allowances, tax year 2025, read 15 October 2026.
• Internal Revenue Service, Notice 2026-60, 2026-2027 Special Per Diem Rates, high-low rates and high-cost localities effective 1 October 2026, read 15 October 2026.
• Internal Revenue Service, Topic no. 511, Business travel expenses, read 15 October 2026.
• U.S. General Services Administration, Per diem rates and FY 2027 per diem highlights, fiscal year 2027 (1 October 2026 to 30 September 2027), read 15 October 2026.
• U.S. Bureau of Labor Statistics, Occupational Outlook Handbook, Registered Nurses, 2025 median pay, read 15 October 2026.
• NCSBN, Nurse Licensure Compact, read 15 October 2026.