Rails - Why does my nested model form not require 'accepts_nested_attributes_for'

You don't need it because your pattern is wrong:

@user_item = @item.user_items.build(user_id: current_user.id, picture: item_params[:item][:picture])

With your above code, you're creating individual user_items from each @item. This does not require accepts_nested_attributes_for, but is cumbersome, against convention and very hacky.

Here's how it should be done:

Models

#app/models/item.rb
class Item < ActiveRecord::Base
  has_many :user_items
  has_many :users, through: :user_items

  accepts_nested_attributes_for :user_items
end

#app/models/user_item.rb
class UserItem < ActiveRecord::Base
  belongs_to :user
  belongs_to :item
end

Controllers

#app/controllers/items_controller.rb
class ItemsController < ApplicationController
  def new
    @item = Item.new
    @item.user_items.build
  end

  def create
    @item = Item.new item_params
    redirect_to @item, notice: "Thank you for your item submission." if @item.save
  end

  private

  def item_params
    params.require(:item).permit(:name, :description, :tag_list, user_items_attributes: [:picture])
  end
end

Views

#app/views/items/new.html.erb
<%= simple_form_for @item do |item_builder| %>
  <%= item_builder.input :name, required: false, error: false, label: "Item name" %>
  <%= item_builder.input :description, as: :text, required: false, error: false, label: "Describe item" %>
  <%= item_builder.input :tag_list, required: false, label: "Tags" %>
  <%= item_builder.simple_fields_for :user_items do |user_item_builder| %>
    <%= user_item_builder.input :picture, as: :file, required: false, label: "Picture of you with this item" %>
  <% end %>
  <%= item_builder.submit 'Submit new item', class: "btn btn-primary pull-right inherit-width" %>
<% end %>

is there a problem with the way I'm doing it

Technically, no.

However, if you aspire to be a professional, or on a similar level, you'll not get very far with the code you wrote.

Using a framework like Rails gives you access to an unprecedented array of pre-baked functionality. The best code is not the code you wrote, but the library code that's been compiled & tested over years of production use.

Whilst your code works, it's not efficient nor extensible.

--

The ultimate key of whether what you've written is "right" is whether the future you would be proud of looking at it again. If not, you're probably best refactoring.

Update

If you want to give Item a status, you'll want to look at the enum module for ActiveRecord models:

#app/models/item.rb
class Item < ActiveRecord::Base
  enum status: [:active, :pending, :declined]
end

This is a very interesting method, as it provides a series of class methods (scopes), and instance methods:

@item = Item.find x

@item.active?   #-> true
@item.pending?  #-> false
@item.declined? #-> false

Item.active     #-> collection of "active" items
Item.pending    #-> collection of "pending" items
Item.declined   #-> collection of "declined" items

To save an Item's status, you could use the collection_select as so:

<%= form_for @item do |f| %>
  <%= f.collection_select :status, Item.statuses, :first, :first %>
  <%= f.submit %>
<% end %> 

Update

Your code can be improved massively:

def create
    @item= Item.new item_params #-> this line should do ALL the heavy lifting.

    if @item.save
      redirect_to items_path, notice: "Thank you for your item request!"
    else
      render :new
    end
end

private

def item_params
    params.require(:item).permit(:name, :description, :tag_list, user_items_attributes: [:picture]).merge(created_by: current_user.id)
end

The file field won't be populated again if you have validation issues; it's an OS problem, not Rails (how does the OS know your file is in the same location as it was when you first submitted?).

You need to make your create code as succinct as possible; explicit declarations for attributes is generally a bad idea. You should put as much of it as possible into the Item model (enum etc).