Travel Nurse Tax Deductions: What You Need To Know

There are so many benefits of being a travel nurse, and come April, there’s an added upside – travel nurse tax deductions that you can take advantage of!

If you get nervous about travel nurse tax prep, we’re here to make this process easy with our tips.

First, let’s review the reasons why filing taxes as a travel nurse can typically be a bit more complicated:

Multiple States

If you work in more than one state, you have to file travel nurse taxes in each location. The exception is that one of the states has a reciprocal agreement with the state where you live. This takes a depth of understanding of state tax returns that most people don’t have. On top of that, you still have to file your federal tax returns and understand all the tax deductions for travel nurses that you can take.

Permanent Residence

If you don’t maintain a permanent residence in one state, the IRS classifies you as transient, and you, therefore, will not qualify for travel nurse tax deductions. To qualify, you must have one permanent residence you return to in between assignments.

Where You Work Versus Where You Live

If you’ve worked in one state for more than 12 months, then that state is your home. According to the IRS, this is even the case if you maintain a permanent residence in another state.

Your Salary

The number you see on your payslip might be a blended rate, which is your taxable base rate, as well as non-taxable reimbursements and stipends.

What exactly can travel nurses claim on taxes? Take a look at our travel nursing taxes guide below!

What Travel Nurse Tax Deductions Should I Be Aware Of?

In order to minimize the amount of tax you have to pay and to take advantage of the tax deductions for travel nurses you may qualify for, you need to understand the ins and outs of the various tax write-offs for travel nurses. These can include:

Tax break #1 – The costs of maintaining your tax home

Your tax home is your fixed abode. This is the residence you return to between jobs, as long as that job doesn’t force you to work in a single location for more than 12 months.

You need to establish a tax home in order to claim travel expenses – you can’t prove you’re traveling if you don’t have somewhere that you’re leaving behind. You can provide proof of your tax home by:

  • Keeping copies of mortgage or rent documents
  • Maintaining your driver’s license in your home state
  • Maintaining your car registration in your home state
  • Registering as a voter in your home state
  • Filing your taxes in your state

Tax break #2 – Travel expenses from your tax home to your place of work

Once you have set your tax home, anytime you’re away from home you can deduct your travel expenses. These expenses include:

  • Airline tickets
  • Train, bus, and boat fare
  • Taxi fares to and from the airport, terminal, or station
  • Shipping and baggage
  • Car rental fees
  • Any car-related travel such as gas, car maintenance costs, tolls, and parking
  • All costs associated with accommodation and meals
  • All tips associated with these costs

Instead of keeping a record of every meal and deducting the actual cost, use a standard meal allowance, which is generally limited to 50% of the unreimbursed cost.

Tax break #3 – Professional expenses

Tax deductions for travel nurses also include all expenses that are required for your job. They include:

  • Malpractice insurance
  • The costs of your uniforms, including dry cleaning and laundry costs
  • Any phone, Internet, and computer-related expenses—including warranties, as well as apps and other software related to your job
  • The costs of professional licensing
  • The costs of continued education, including books
  • The costs of any trade literature
  • Any costs related to your job search

And be sure to include any home office costs that are incurred for the convenience of your employer!

Keep Receipts for Everything!

In order to qualify for all of these travel nurse tax deductions, you need to provide proof that you paid for them.

That means keeping all receipts—even when it’s just for a cup of coffee while you’re waiting at the airport.

We recommend noting your receipts down each month to make it easier to maximize your tax write-offs for travel nurses. This can be as simple as creating a spreadsheet on your computer that you fill out each night or using a free mobile app to log expenses right from your phone.

Ask Your Staffing Agency About Taxable Income

To ensure you’re not paying too much income tax, double-check with your agency!

The staffing firm’s finance department will be able to provide you with a clear breakdown that you can use for the filing of your travel nurse taxes.

Our Takeaway Tip

Travel nursing and taxes can seem tricky, so if you feel uncomfortable, go to a professional to help answer all of your questions.

Deductions Make It Possible to Earn More Money

With the help of your tax deductions, you can earn more money as a travel nurse. What’s not to love about a higher salary?

If you are interested in becoming a travel nurse, fill out our contact form and we’ll be in touch.

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