The one-year rule (temporary vs. indefinite)

The rule (settled)

An assignment in one location is temporary if it's realistically expected to last (and does last) 1 year or less. It's indefinite if it's realistically expected to last more than 1 year, even if it ends up shorter. Travel to an indefinite assignment isn't deductible, and stipends for it are taxable. (IRC §162(a) flush language; Pub 463 (2025); Rev. Rul. 93-86, 1993-2 C.B. 71)

The "expectation" nuance

• What counts is your realistic expectation at the start, and again whenever it changes.
• Example (Pub 463 "Fresno"): a job expected to last 9 months gets extended at month 8 to run beyond a year. It becomes indefinite on the date the expectation changed. Expenses before that date stay deductible; expenses after it don't.
• A job realistically expected to last 18 months is indefinite from day 1, even if it ends at month 10.

What it means for you

• Always log extensions with the date you agreed to them.

Gray areas

• Back-to-back assignments in the same area: "A series of assignments to the same location, all for short periods but that together cover a long period, may be considered an indefinite assignment." (Pub 463 (2025))
• The agency guideline of "no more than 12 months in the same metro within 24 months" is industry practice, not a published IRS bright line.

Go deeper

• Statute. "The taxpayer shall not be treated as being temporarily away from home during any period of employment if such period exceeds 1 year." (IRC §162(a), flush language)
• If an assignment becomes indefinite, amounts your employer pays for living expenses must be included in income, "even if they are called 'travel allowances' and you account to your employer for them." (Pub 463 (2025))
• The same interpretation is in Rev. Rul. 93-86, 1993-2 C.B. 71.