> ## Documentation Index
> Fetch the complete documentation index at: https://docs.taxhomebase.com/llms.txt
> Use this file to discover all available pages before exploring further.

# The 12-Month Rule

> How cumulative time in one location can end your stipend eligibility.

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The 12-month rule is one of the most misunderstood IRS rules affecting travel nurses. It determines when a "temporary" work location becomes your new tax home — ending your eligibility for tax-free stipends at that location.

## The Rule

If you work in the same general area for **more than 12 months** (or reasonably expect to), the IRS considers that location your tax home. Once it's your tax home, you can no longer receive tax-free housing and meal stipends for working there.

## Key Details

### Cumulative, Not Continuous

The 12-month clock counts **total time** in a location, not just a single continuous stint. If you work 6 months in Dallas, leave for 3 months, then return for 7 months, you've spent 13 months in Dallas — exceeding the limit.

### Location-Based, Not Facility-Based

The IRS looks at the **general area**, not the specific hospital. Working at three different facilities in the Houston metro area all counts toward the same 12-month clock.

### Rolling 24-Month Window

TaxHomeBase tracks location durations using a rolling 24-month window to capture cumulative time across assignments.

### The "Expectation" Trap

The rule triggers not just when you **actually** exceed 12 months, but when you **reasonably expect** to. If you sign a 13-month contract, the rule may apply from day one — not just at the 12-month mark.

## What Happens When You Exceed It

* Stipends for that location become taxable
* The location may be considered your new tax home
* If you have two tax homes (old permanent + new work location), the IRS uses a "facts and circumstances" test to determine which is primary
* You may still receive tax-free stipends for **other** locations that haven't exceeded 12 months

## How TaxHomeBase Tracks This

### Assignment-Level Badges

Each assignment card shows duration badges:

* **Amber** "Approaching 12-month limit" — Assignment exceeds 45 weeks
* **Red** "Exceeds 12-month limit" — Assignment exceeds 52 weeks

### Location Duration Tracker

The [Assignments page](/guides/assignments) includes a Location Duration Tracker that shows cumulative days per location across all assignments in a rolling 24-month window:

| Status                | Days         | What It Means                           |
| --------------------- | ------------ | --------------------------------------- |
| **Safe**              | \< 270 days  | Well within the limit                   |
| **Approaching limit** | 270–365 days | Consider the 12-month rule implications |
| **Exceeds limit**     | > 365 days   | Location may be your new tax home       |

### Alerts

The notification system includes a `long_assignment` alert that triggers at 45 weeks for any single assignment.

## Considerations

Travel nurses approaching the 12-month threshold often weigh these factors with their tax advisor:

* **Location rotation** — Returning to the same metro area within 12 months adds to the cumulative clock
* **Cumulative tracking** — The IRS looks at total time per location, not just individual contract lengths
* **Extension risk** — Extending a contract near the 12-month mark may trigger the rule
* **Break documentation** — Records of where you worked during gaps between stints in the same area can support your position