Handling Travel Nurse Tax Issues

tax-travel-nurse

tax-travel-nurseThere are many benefits for travel nurses. The idea of pursuing your career while traveling and seeing the world appeals to many of us. Nursing is in such high demand that it can provide a myriad of careers and opportunities.

While this lifestyle is rewarding and exciting, it can also bring up a few challenges that must be addressed. Travel nurse tax issues may be considered to be problematic for some of us who prefer not to deal with taxes.  By following a few tips you can truly improve the bottom line of a Wandering Nurse. The requirements regarding taxes should be reviewed before you begin a travel nurse career so that you don’t have problems down the road.

The following tips can help you manage taxes as a traveling nurse:

  • Get organized! It’s easy for us to focus intensely on our job and lose track of our own personal finances. Also, it can be difficult to stay organized when one travels away from a familiar setting. It is important to establish habits that will allow you to stay on top of your tax information.
  • Maintain proof of your home base. Even if you are traveling throughout the year, it is important to keep your proof of residence for tax purposes. Taxes will be filed in the state where you reside and you can prove it with a state driver’s license and registration to vote as well as proof of residence. It is important to have a home base, even if you travel throughout the year. If you don’t establish and maintain this presence in the state where you pay taxes, you will not be able to deduct your travel expenses. You don’t have to pay thousands of dollars in mortgage payments in order to maintain residency in a state, but you should be able to show proof that you rent or own a place to stay.
  • Business expenses should always be tracked and deducted. For example, if you maintain malpractice insurance or pay for telephone or internet access for business purposes, you should file proof of these expenses and make your accountant aware of them.
  • Transportation costs can be a huge part of your tax deductions, especially if you take multiple assignments throughout the year. Not only can you deduct expenses for any type of transport including airplanes, trains, ships, buses, taxis, or mule carts; but you can write off parking expenses and car rentals as well.
  • Choose a tax professional who is familiar with your career.  Find one who understands the unique tax possibilities related to your travel nurse career. You may need to find someone who is able to manage a tax year with work performed in multiple states or nations. Also, you will want an accountant who knows what deductions available based on your job, your travel, and your location(s).
  • Be properly prepared to handle tax issues if you are hired as an independent contractor. Many of us supplement our income doing freelance work, such as writing about certain conditions for informational websites or writing about our experiences in general. We must be sure to track the freelance work, be aware of whether or not we will receive end-of-the-year information regarding payments made, etc.
  • Take full advantage of the opportunity to contribute to your retirement fund. Check with your tax professional about the best way to manage your contribution by optimizing the amount added. For example, you may want to pay a larger amount to your 401K or IRA in order to lower your taxes for the year.
  • Keep close track of any expenses you incur and save the receipts. It is helpful to go over your receipts on a regular basis so that you are not overwhelmed by a giant shower of receipts at the end of the year. While large expenses such as education or training are obvious, it is important to keep track of smaller items like uniforms. These items add up and can make a difference when taxes are calculated.
  • Be sure to see your tax professional before a year ends. The intricacies of tax calculation make it hard to know how much a few changes can impact the final results. If your accountant performs preliminary calculations and finds you are close to a different tax bracket, you may be advised to make a charitable donation. Cash donations are easily made, but even clothing or household items can be donated to non-profit organizations. Make sure that you receive a receipt, whether you donate to the Salvation Army or your local theatre. Your accountant could also encourage you to make tax related purchases before the end of the year. Sometimes paying bills early can also help in this type of scenario.
  • There are applications available that make it easy to scan in receipts.  This allows you to save them to a folder in the cloud. You will not have to worry about keeping track of them while you travel.

This could seem overwhelming at first, but there are many things you can do to keep yourself organized. Keep your important receipts and tax documents in a portable tote or even a backpack. A tote is easy to store in a safe place and easil to access your files and keep them up to date.

Remember that some tax deductions, such as mileage, must be accurately maintained throughout the year. You cannot simply go back and guesstimate  your mileage as you are required to keep track in a timely way.

Travel nurses may prefer not to deal with travel nurse tax issues. You will find the payoff is worth the effort it takes to get and stay organized. Don’t be afraid to interview and price several tax professionals before settling on the one who is right for you. Ask questions and find out if your accountant can accommodate your tax needs. These steps will position you to file your taxes without anxiety.  Also this will help to keep as much money in your pocket as possible.

For more information on taxes check out this site traveltax.com

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Cheryl Roby, RN

Cheryl J. Roby is a retired RN and US Army Nurse Major. She has over 30 years of nursing experience and 26 years of military experience in the Army Nurse Corp. During her nursing career she has traveled as part of her military experience visiting many of the 50 states and once to South Korea. Her medical training began during the Vietnam era when trained as an army medic. She went on to train as an OR tech and then as a LVN/LPN. She completed nursing school and was direct commissioned into the reserve Army Nurse Corp. nurse. She appreciated the challenge of working in various specialties and expanding her clinical and professional skill sets. Her time in the Army Reserves and California National Guard gave her the opportunity to travel to most of the 50 states and working in other medical facilities. During her career she spent years as an OR nurse, Occupational Health Nurse, Hospice Nurse, Forensic Nurse, Nurse Case Manager for developmental disabilities, Parish Nursing as well as being a Nurse Entrepreneur.

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