Tax Tips for Travel Nurses and Allied Professionals in 2025

Tax Tips for Travel Nurses and Allied Professionals in 2025:

Traveling offers incredible flexibility, adventure and financial opportunity—but it also brings unique tax challenges. Unlike staff clinicians, travel clinicians often receive a mix of taxable income and non-taxable stipends, work in multiple states and must maintain a “tax home” to qualify for certain deductions. If you're a travel nurse or allied professional gearing up for tax season, here are the essential tips to help you file smart and keep more of your hard-earned money.

1. Understand Your Pay Structure

Travelers typically receive two types of compensation:

• Taxable income: This includes your hourly wage, overtime and bonuses. It’s subject to federal, state and local taxes.

• Non-taxable stipends: These cover housing, meals and incidental expenses. They’re only tax-free if you meet IRS requirements

To qualify for tax-free stipends, you must be working away from your tax home and on a temporary assignment.

2. Establish and Maintain a Tax Home

Your tax home is the city or area where you regularly live and work. To maintain it, you should:

• Return to your tax home between assignments.

• Pay rent or mortgage and utilities at your tax home.

• Maintain a driver’s license, voter registration and bank accounts in that location.

Failing to prove a tax home can result in your stipends being taxed as income

3. Track Your Assignments and Expenses

Keep detailed records of:

• Assignment dates and locations

• Travel mileage

• Housing costs

• Meal expenses

• Licensing and credentialing fees

Use apps or spreadsheets to log everything. These records are crucial if you're ever audited or need to justify deductions.

4. Know the 50-Mile Rule (and Its Limits)

Many agencies use the 50-mile rule—meaning your assignment must be at least 50 miles from your tax home to qualify for stipends. However, the IRS doesn’t officially recognize this rule. Instead, the IRS focuses on whether your work requires you to stay overnight away from your tax home

5. Be Aware of Multi-State Tax Filing

If you worked in multiple states, you may need to file state tax returns in each one. Some states have reciprocal agreements, but many don’t. Be sure to:

• Track how many days you worked in each state

• Understand each state’s tax laws

• Consider using a tax professional familiar with travel nursing

6. Don’t Overlook Deductions

Even if you receive stipends, you may still qualify for deductions, especially if you itemize. Common deductions include:

• Licensing and certification fees

• Uniforms and scrubs

• Continuing education

• Travel expenses not reimbursed by your agency

Note: Since the 2017 Tax Cuts and Jobs Act, W-2 employees can no longer deduct unreimbursed employee expenses on their federal return—but some states still allow it

7. Use a Tax Professional Who Understands Travel Nursing

Travel nurse taxes are complex. A tax preparer unfamiliar with your situation might misclassify your income or miss key deductions. Look for a CPA or enrolled agent who specializes in travel healthcare professionals.

8. Avoid 1099 Contracts Unless You’re Prepared

Some agencies offer 1099 contracts, which classify you as an independent contractor. While this can increase your take-home pay, it also means:

• No tax withholdings

• You’re responsible for self-employment taxes

• You must pay quarterly estimated taxes

Unless you’re experienced with self-employment, W-2 contracts are generally safer and simpler.

9. Plan for Retirement and Tax Savings

Consider contributing to a Roth IRA or Traditional IRA to reduce your taxable income and save for the future. If you’re on a 1099 contract, you may also be eligible for a Solo 401(k) or SEP IRA.

10. Stay Informed and Organized

Tax laws change, and staying informed is key. Bookmark reliable resources, attend webinars and keep your documents organized throughout the year—not just at tax time.

Conclusion

Being a travel nurse comes with amazing perks, but it also requires a proactive approach to taxes. By understanding your pay, maintaining a tax home and keeping good records, you can avoid costly mistakes and make the most of your income. When in doubt, consult a tax professional who knows the ins and outs of the travel healthcare profession.