StaffCare

Locum Tenens and Taxes: How Does It Work?

Locum Tenens and Taxes

One of the most common questions we hear from potential locum tenens providers is, “What about taxes?”

Some of the most common tax questions we hear concern such things as whether locum tenens physicians pay higher taxes than they would as an employee, if they’ll still be able to prepare their own taxes or if they’ll need to hire someone, if they need to be incorporated, and what expenses will be deductible.

With tax season now bearing down upon us, we thought this would be a good time to address some of these questions. While we can’t provide specific advice for your situation, we can give an overview of some of the most common concerns we encounter.

What's My Locum Tenens Tax Status?

Locum tenens physicians are independent contractors. Like any other contractor, you will be issued a Form 1099 and will be expected to pay your own taxes. The IRSwebsite provides good information on tax regulations for independent contractors. If you aren’t comfortable filing taxes as an independent contractor, a skilled tax preparation professional can take a large portion of the burden off your shoulders.

Are My Travel Expenses Deductible?

One benefit of locum tenens work is that many of your work-related expenses are deductible. Transportation, lodging and meals may be deducted from your tax return, subject to certain requirements such as travel distance and length of assignment.

Your tax professional will be able to tell you more about which expenses are allowable. Remember, to take advantage of these deductions, you must be conscientious about tracking expenses and keeping receipts.

What about state income tax?

If you've worked in a state that has a state income tax, you may be responsible for paying those taxes. These are separate from and in addition to any taxes you may be liable for in the state of your permanent residence.

Can You Help Me With My Taxes?

As a locum tenens staffing firm, we do not provide any tax or accounting advice. There are many skilled and knowledgeable tax preparation professionals who can address your specific questions and issues.

Some things you may want to ask a potential tax preparer are:

  • What tax deductions am I eligible for?
  • Is the self-employment tax higher than if I were an employee?
  • Do I need to be incorporated? If so, how do I go about it?

If you’re interested in working as a locum tenens physician, please contact us at (800) 685-2272 to learn about our open positions nationwide.

Michelle Hoogerwerf is Divisional Vice President of Advanced Care for Staff Care