How do I establish a tax home as a digital nomad who works from multiple countries each year?
A digital nomad establishes a tax home by designating a single foreign country as the regular or principal place of business with substantial presence, maintaining a lease or other housing, establishing a local bank or payment arrangement, and developing other local ties. The IRS evaluates the tax home based on facts and circumstances under Publication 54.
Factors the IRS considers:
- Time spent in the foreign country relative to other countries
- A leased or owned residence in the country
- Bank account, local payments, utilities in your name
- Driver’s license or residence permit
- Family ties, if applicable
- Mailing address and where important documents are kept
Practical nomad setups that tend to hold up:
| Setup | Tax home likely in |
| 6 months Mexico, 4 months travel, 2 months Portugal | Mexico (longest stay, documented lease) |
| 3 months each in 4 different countries | Weak: no clear tax home |
| 8 months Portugal on D7 visa, 3 months travel, 1 month U.S. | Portugal |
| Bouncing every 3-6 weeks with no lease anywhere | No foreign tax home; FEIE at risk |
Things to avoid:
- Returning to a U.S.-owned home can pull your tax home back to the U.S.
- Keeping a primary U.S. address for mail, license, and voter registration
- Storing belongings in a U.S. storage unit when no foreign equivalent exists
Digital Nomads who travel constantly without a base should consider anchoring in one country for at least a portion of the year. A short-term-rental approach with a 6-month lease in Portugal, Mexico, or Thailand is usually enough to establish a tax home.
For more on tax home rules, see our How to establish a tax home in a foreign country or Digital Nomad Taxes.
Last updated on April 29, 2026
