Travel nurse taxes, assignment by assignment
You take contracts in different states, get paid part wage and part stipend, and pick up per diem shifts in between. We prepare returns that match how that actually works.
Nothing is due today. Personal returns start at $250.
More and more of this work is paid on a Form 1099 rather than a W-2. Agencies, per diem pools, telehealth platforms and facilities that contract directly are all doing it, and plenty of clinicians now have a year that is mostly or entirely 1099. That matters, because 1099 work is self-employment, and self-employment is where the full deduction list below actually lives, along with a retirement plan you control and the qualified business income deduction. Your return also has moving parts a general preparer does not see every day: a tax home decides whether housing and meal stipends stay tax free, and you earn income in states you only lived in for the length of a contract. If part of your year was on a W-2, expenses tied to that side generally are not deductible federally, so we keep the two sides apart rather than blending them. We build the return around your assignment history instead of a generic checklist.
What travel nurses can usually deduct
Ordinary and necessary costs of your work. Rules and dollar limits change year to year, so we confirm every one of these against the current year when we prepare your return.
Additional state licenses
Every state you take a contract in wants its own license, endorsement, or compact upgrade, plus renewals, Nursys verification, and the fingerprint and board application fees that come with them.
Renewals and extra state licenses you pick up while you are already working are ordinary costs of the work. What you paid to become a nurse in the first place is treated differently, because costs that qualified you for the profession generally are not deductible at all, so keep those receipts in a separate pile and let us look at them.
Certifications and continuing education
ACLS, PALS, NRP, TNCC, and specialty certifications like CCRN, along with renewal fees, review courses, the CE subscription you use to hit each state's hours, association dues, and the clinical reference apps you actually open.
Training that keeps you current in the work you already do is deductible. A degree that moves you into a different role, such as NP or CRNA school, generally is not, because it qualifies you for a new profession.
Scrubs and required gear
Scrubs a facility requires, the specific color set a unit makes you buy, badge reels, and laundering the scrubs you cannot wear anywhere else.
Clothing counts only when the work requires it and it is not suitable for everyday wear. Scrubs a facility requires generally meet that test. The sneakers, compression socks, and the fleece jacket you also wear off shift do not.
Shift tools and equipment
Your stethoscope, trauma shears, penlight, pulse oximeter, hemostats, the replacement for the pair that walked off the unit, and the tablet or laptop you chart and credential on.
Small tools generally come off in full the year you buy them. More expensive equipment can fall under the depreciation rules, and anything you also use personally gets split by business use. Keep the dated receipt.
Getting to the assignment
The flight or the drive out to a contract, baggage fees, the rental car until your own vehicle catches up, tolls, and the trip home at the end of the contract.
This works only while the assignment is temporary and you are away from a real tax home. A trip home on your days off is deductible only up to what you would have spent on meals and lodging staying at the assignment.
Lodging on assignment
The furnished rental, the extended stay, the RV pad, utilities and internet at the assignment address, and a deposit the landlord kept, which we will look at with the lease.
This turns entirely on your tax home. You need a real home you keep paying for while you are gone, and the assignment has to be temporary. Once you realistically expect to be in one area longer than a year, the tax law stops treating the stay as temporary, and the deduction stops from the point that expectation changes.
Meals while away overnight
Groceries and meals while you are away from your tax home overnight on an assignment. You can track actual cost or use the federal meal allowance published for that location.
Meals are only partly deductible, at the share the law allows for the year you are filing, so we apply whatever is current rather than a figure from an old article. And food you buy during a shift near home is personal, no matter how long the shift ran.
Miles you drive for work
Driving between two facilities in the same day, out to a float site, to a required competency or orientation day, and the miles between your travel housing and the hospital while you are away from your tax home.
The drive from your permanent home to a local facility where you regularly work is commuting and never counts. Log the date, miles, and reason as you go, because a log built in April does not hold up. You can use the standard mileage rate the IRS publishes for that year or your actual vehicle costs, and the method you choose the first year you use that car limits what you can switch to later.
Credentialing and compliance costs
Drug screens, background checks, fingerprinting, respirator fit testing, contract required physicals, module and orientation fees, and the notary and shipping charges for credentialing packets.
Screenings a contract requires are costs of getting the work. Vaccines and titers look more like personal medical care, so tell us which ones the assignment demanded and which you would have had anyway.
Professional liability insurance
Your own malpractice policy and license defense coverage, which some contract and per diem clinicians carry on top of whatever the facility provides.
The disability and life policies sold to you in the same conversation are personal, not business expenses, even when one agency sells you all three.
Phone, internet, and charting tech
The business share of your phone bill, the hotspot you bought because the rental Wi-Fi drops mid charting, scheduling and credentialing apps, and secure storage for your documents.
A phone you use for everything gets split by business use, not deducted whole. Write down how you arrived at the percentage while you still remember.
Self-employed health insurance
Premiums you pay yourself, including a marketplace plan between contracts, covering you, your spouse, and your dependents. This one is open to you only when you have self-employment income, such as 1099 per diem or contract work, to support it.
Not allowed for any month you were eligible for subsidized coverage through an employer or your spouse's employer. It is taken in figuring adjusted gross income rather than on Schedule C, so it does not reduce self-employment tax, and it cannot be more than the net profit from the work it relates to.
A retirement plan you control
Self-employment income lets you open a SEP IRA or a solo 401(k) and deduct what you put in. A solo 401(k) usually allows a larger contribution at the same level of profit because you contribute both as the employee and as the business, and it can be worth having even when the 1099 work is a side of your year rather than all of it.
Contribution limits are set annually and are calculated from your net self-employment earnings, not from gross receipts. The deadline to open an account is not the same as the deadline to fund it, and the two differ by plan type, so ask before December rather than at filing. Once you have employees, some of these plans require covering them too.
The qualified business income deduction
Net profit from your 1099 work may qualify for a deduction of up to 20 percent of that income, taken on your personal return without reducing your self-employment tax. It costs nothing to claim and it is the single largest write-off most independent clinicians never hear about.
Health care is a specified service field, so this deduction is fully available only below an income threshold that is adjusted each year, then phases out and disappears above it. Filing status, the wages your business pays and your total taxable income all move the answer, so it is calculated rather than assumed. It also applies to self-employment profit, not to W-2 wages.
Schedule C is where 1099 contract and per diem work goes, and it stays the right home for most clinicians. It is worth pricing out an S corp only once that work is your steady full time income with consistent profit year over year, because that decision is really about running payroll, not filing one form. Being on a 1099 does not require an entity, and forming one does not by itself change your federal tax.
What to bring us
You do not need all of it to start. Send what you have and your checklist shows what is still open.
- Every W-2 and 1099-NEC for the year, including agencies you worked only a few shifts for
- Your agency contracts and pay packet breakdowns showing the taxable hourly rate next to the stipend portion
- Proof of your tax home: lease or mortgage statement, utility bills, and what you keep paying while you are on assignment
- An assignment list for the year: facility, city, start date, end date, and any extensions
- Your mileage log or the export from your mileage app
- Receipts for licenses, certifications, CE, scrubs, and equipment
- Travel records: flights, lodging, rental cars, baggage, tolls, and parking
- Form 1095-A if you bought marketplace coverage, plus what you paid in premiums
- Dates and amounts of any estimated tax payments you made during the year
- Last year's return, and your LLC or S corp paperwork if you have an entity
What trips people up
Treating the housing and meal stipend as tax free because the agency labeled it that way.
The facts decide it, not the pay packet. Keep the lease, the utility bills, and proof of what you pay to hold that home while you are gone. If you cannot support a tax home, plan for the stipend to be taxable and set the money aside now instead of finding out later.
Signing extension after extension in the same metro area without counting the calendar.
Track days by area, not by contract. Call us before the extension that would push you past a year in one place, because the travel deductions and the tax free treatment can stop from the moment you expect to stay that long.
Rebuilding a whole travel year from memory in April.
One folder per assignment. Drop in the contract, the pay packet, lodging receipts, and license fees the week they happen, and log miles weekly rather than annually.
Skipping quarterly payments because the agency W-2 withholding looked like enough.
1099 per diem income carries no withholding and owes self-employment tax on top of income tax. Set aside part of every deposit and pay quarterly, or raise the withholding on the W-2 side to cover it.
Claiming a home office in the room you also sleep in between contracts.
A home office has to be used regularly and only for business, and under current federal law an employee cannot claim one at all. If the space does not qualify, drop it and put that effort into documenting your tax home, which is worth far more to a traveler.
What it costs
Our published list, the same one everyone sees. Prices marked “from” are starting points, and your exact number is confirmed in writing before any work begins.
$0 is due today. You pay when you sign, or your fee can come out of your refund for a $50 bank fee, so it is $0 out of pocket.
Questions we get from your trade
Are my housing and meal stipends really tax free?+
Only if you have a tax home you are traveling away from and the assignment is temporary. That usually means a home you genuinely pay for and keep available while you are gone, with duplicated costs you can prove. If you have no such home, the IRS treats you as itinerant, your tax home travels with you, you are never away from home, and the stipends are taxable compensation.
I am a W-2 traveler with an agency. Can I still deduct my licenses and scrubs?+
On the federal return, an employee cannot deduct unreimbursed job expenses under the law as it stands, which is not what most nurses expect. Some states still allow a version of those deductions on the state return, so where you file matters. If you also work 1099 per diem shifts, expenses that belong to that work go on Schedule C, and we keep the two sides separate.
Which states do I have to file in?+
Generally a nonresident return in each state where you physically worked and earned income, plus a resident return in your home state, subject to each state's own filing threshold. Your home state usually gives you a credit for tax paid to the other states so the same income is not taxed twice. Some states have no income tax and some neighboring states have agreements that change the answer, so the count of returns is rarely the same as the count of contracts.
Do I need to make quarterly estimated payments?+
If you expect to owe when you file, yes. Paying the whole balance in April does not avoid the underpayment charge the IRS adds when too little came in during the year. We look at your contracts and your W-2 withholding together and give you dates and amounts, rather than a guess.
Should I set up an LLC or elect S corp status?+
A single member LLC by itself does not change your federal income tax; the income still lands on Schedule C. An S corp election changes how you pay yourself and adds payroll filings and a real cost to run, so it only makes sense at a steady level of profit. Some agencies and some state boards also have rules about contracting with a clinician's entity, so check that before you form anything.
I had agency W-2 income and 1099 per diem shifts in the same year. How does that work?+
Both go on the same return. The 1099 work goes on Schedule C with its own expenses, the profit carries to Schedule SE where self-employment tax is figured, and half of that tax comes back as an adjustment on your return. Expenses have to belong to the 1099 work, so we ask which shifts each cost supported instead of spreading everything across the year.
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