As they say, there’s nothing certain in life except death and taxes—but, the whole concept of travel nurse taxes gets a bit tricky. While traveling you are probably wondering about how you will be taxed due to living in a new destination for a period of time. Typically there are stipends or reimbursements for travel nurses. The stipends and reimbursements are for meals and incidentals, including parking, bus/taxi fares and housing. You can also be part of the “tax advantage plan” in which some expenses are tax deductible and some are non-taxable. This is how a lot of travel nursing jobs are handled with regards to taxing.
To Do’s Before Your Travel
For starters you must have a permanent tax home and your travel nursing job must not be in commuting distance of your permanent tax home. This is how you will be able to qualify for nontaxable travel benefits such as transportation and housing costs. Failing to have both of these things can result in taxable income from the start of your trip.
A Tax Home Representation form also needs to be filled out before the start of your assignment and whenever there is a change to your location. It is recommended to have a tax adviser assist you and with everything else you would need help on, your recruiter will help every step of the way.
Travel Nurse Taxing Facts
If your travel nursing assignment is located in commuting distance from your personal residence, travel benefits will not be paid due to not having any travel costs. If you are traveling away from your permanent residence it is recommended to keep a mileage log that tracks your mileage to and from your new travel nursing destination. In regards to injury while on the job you will receive 2/3 of your hourly taxable pay rate.
Along with information on the IRS, many travel nurses are curious as to what a “tax home” means to them. A “tax home” is not where your permanent residence is; it is where the majority of your income is earned. You need to maintain all conditions to maintain a tax home or you will be claimed as an “itinerant worker.”
One last thing, have your travel assignments stay within those 13-26 week periods due to you not wanting the IRS to think that you have abandoned your permanent residence.
Hopefully these tips and facts are helpful with the questions that you might have dealing with taxing while you are on assignment in a new location. Your recruiter and employer will help you with all of your further questions as well; it is recommended to keep in close contact with them.