7 Tax Tips for Travel Nurses

Tax season is around the corner and we know that as a travel nurse, doing your taxes can be a daunting task. It is common for travel nurses to have both taxable and non-taxable income, coupled with travel expenses and tax homes you may be wondering where to start.

This year, April 15th, 2024 is the deadline to file your 2023 federal tax return wih the IRS. April 15th, 2024 is also the deadline to file an extension if you need more time to gather and submit all of your relevant paperwork. Usually, the extension gives you until October to round up and send all your tax documents to the IRS.

Does the very thought of filing your taxes have you immediately feeling overwhelmed? As intimidating as filing taxes can be (especially for travel nurses), the following tips can make processing your returns a breeze!

Disclaimer: These tips are intended to serve as a general guide based on the tax needs and requirements most travel nurses encounter. Please seek a certified Tax Professional or CPA to help with your individual tax filing needs. 

1. Be wary of using tax filing software

Not all tax filing software is alike, and when calculating your returns, the standardized software may not take you through all the considerations necessary as a travel nurse. Depending on your circumstances, you may have multiple state taxes, aside from those in your tax home. In addition, there are a number of items that is tax deductible ranging from living costs, licensure fees, and travel-related expenses. You can see a full list on the IRS website.

2. Find/Keep in contact with a trusted Tax Professional

There are many qualified tax professionals out there that can help navigate the many rules and regulations of the IRS. We recommend finding someone who specializes in filing tax returns for professional travelers, as they’re likely to be the most familiar with the nuanced regulations that apply at both the federal and state level. Resources like TravelTax.com can connect you with tax professionals who specialize in helping travel nurses with their tax needs during tax season and throughout the year.

3. File (and pay) your taxes on time

If you think you might have trouble making the tax deadline, make sure to file for an extension before the tax deadline. Visit this page of the official IRS website to learn more or file for an extension.  

4. Know what defines a “permanent residence” and “temporary residence” when filing taxes

Permanent residence is also referred to as a “tax home” or your “tax filing address”. If you are truly duplicating your housing expenses due to your travel nursing career, don’t be so quick to change your address every time you relocate for a new travel nursing contract – this tends to complicate things if you plan to take full advantage of your non-taxed income, even if you are doing so by the book. A good practice is keeping your car and driver’s license registered in your home state. Opting into paperless billing for your car note, cell phone, internet provider, bank statements, etc. also helps with this and saves you from scrambling to update your address every few months.

5. Ensure you qualify for non-taxed stipends before accepting them as part of your compensation package

You can only take advantage of this benefit if you can prove you are duplicating expenses at home and at your work assignment or have a regular job that you return to annually in the same area. In fact, many travel nurses maintain a per-diem position with their preferred agency near their permanent residence to satisfy this requirement – doing this to supplement your income between travel contracts is also a big plus! Going forward, practice your own due diligence to ensure you qualify for any non-taxed stipends before accepting them as part of your compensation package. Verify if you qualify as a local or travel candidate depending on the distance of your tax filing address from the facility. The required distance can vary per facility but it is typically 50-100 miles. This applies to stipends for housing, travel (as mentioned in the previous tip) AND meals. When in doubt, consult a trusted tax professional.

6. Keep all of your documents together (for at least 6 years)

This includes copies of all your nursing contracts, mileage log, and work-related receipts. Mobile apps like Expensify or Smart Receipts that can help busy travel nurses scan receipts and track their expenses easily and securely. Services like GoogleDrive also have this functionality if you prefer to keep or back up your documents to your computer or upload your documents straight into a folder as you go!

7. Know exactly which receipts to keep

Speaking of keeping work-related receipts, many of us could be potentially throwing away receipts that qualify toward your annual work-related tax deductions. These will also come in handy in the event that you are audited down the road. As a rule of thumb, keep track of your receipts for all of the following travel nursing work-related expenses:

• Licensing expenses
• Professional membership or union dues
• Professional insurance
• Purchased scrubs, footwear, PE, etc.
•  Internet, & cell phone bills
• Plane, train, public transit fares
• Parking/taxi/rideshare receipts
• Rental car receipts (don’t forget to also keep your gas receipts if using the rental car for work!)
• Hotels, rent or other short-term housing costs
• Job-related physicals, vaccines, drug testing, etc.

We hope this alleviates some of the tax anxiety travel nurses collectively experience. The good news is you’re not alone, and you’re actually in great company! Most new travel nurses are understandably nervous when filing their taxes for the first time; however, it doesn’t have to be any more painful than charting at the end of your nursing shift (let’s be honest – there’s always a little pain where paperwork is involved).

Advantage Medical Professionals is an employee-based firm that pays all travel nurses and clinicians directly, including the benefit of automatically withholding all necessary Social Security taxes (FICA), Federal Unemployment taxes (FUTA) and State Unemployment taxes (SUTA).

>> Learn more about all of our employee benefits or how you can start working with Advantage Medical Professionals.