At the end of Majora's Mask, Link is back in the lost woods drawing a picture of Skull Kid. The lost woods are in Hyrule, and thus, Link has returned home and is quite a live.
Plus the manual and the directors state that Termina is a parallel world.

__________________

Bomber's Notebook | Zelda Informer, Home of The Bombers | Theorizing Resources | Aralith's OoT Retelling
Voted as Best Zelda Theorist in the Summer '08 Awards. Thank you to all who voted, and to all who inspired me along the way!