What Can Travel Nurses Claim on Taxes?

As a travel nurse, your work takes you to various locations for extended periods, which presents specific requirements for filing federal income taxes. Understanding which expenses are eligible for deductions can significantly impact your tax liability. This guide outlines the qualifications for travel nurse tax benefits and the types of expenses that may be claimed.

Establishing Your Tax Home

The ability to deduct travel-related expenses is contingent upon establishing a “tax home.” The IRS defines a tax home as the general area of your primary place of business. For a travel nurse without a regular place of business, their tax home is considered the place where they regularly live. To claim deductions for travel expenses, you must be working away from this established tax home on a temporary assignment.

The IRS uses a three-factor test to determine if you have a well-maintained tax home. The first factor is performing a portion of your business near your main home and using that home for lodging. The second is incurring duplicate living expenses by paying for housing at your main home while also paying for lodging at your temporary work location. The third factor considers your personal ties to the home, such as where you are registered to vote, vehicle registration, and community connections.

Satisfying at least two of these three factors is sufficient to establish a tax home. This allows you to receive tax-free reimbursements and deduct unreimbursed costs from your travel assignments. Maintaining this tax home requires that you do not abandon it; you or your family should live there, and you should return between assignments. Spending at least 30 days a year at your tax home can help demonstrate its legitimacy to the IRS.

An assignment in a single location that is realistically expected to last for more than one year is not considered temporary under the “one-year rule.” If you work in one metropolitan area for more than a year, that location becomes your new tax home. Consequently, payments for travel, meals, or lodging would be considered part of your taxable income, and you would no longer be able to deduct those expenses.

Common Tax-Deductible Travel Expenses

Once a tax home is established, a travel nurse can deduct ordinary and necessary expenses incurred while on a temporary assignment away from home.

Lodging

The full cost of temporary lodging at your assignment location is a deductible expense. This includes payments for rent on a short-term apartment, hotel or motel stays, and associated utility costs that are not covered by the property owner.

Transportation

If you drive your personal vehicle between your tax home and your temporary assignment, you can deduct the associated costs. The IRS provides two methods for this: the standard mileage rate or the actual expense method. The standard mileage rate allows you to deduct a set amount per mile driven for business purposes; for 2025, the rate is 70 cents per mile.

Alternatively, the actual expense method allows for deducting the real costs of operating your car, including gas, oil, repairs, insurance, and registration, but requires more detailed record-keeping. These deductions also apply to local transportation at your assignment, such as driving between different medical facilities. The cost of commuting from your temporary lodging to your primary workplace is not deductible.

Meals

The cost of meals while on a temporary assignment can also be deducted, using one of two options. The actual cost method requires you to keep detailed receipts for all your meal expenses, and the deduction is limited to 50% of the actual cost.

The per diem method allows you to use a standard meal allowance set by the General Services Administration (GSA), with rates that vary by location. This method simplifies record-keeping, as you do not need to save every meal receipt. You still need to maintain records of your travel dates and locations to justify using the per diem rates for that area.

Deductible Professional and Work-Related Expenses

Travel nurses can deduct various professional expenses related to maintaining their professional status and job requirements. Common examples include fees for state license renewals, professional liability insurance, and dues for membership in professional organizations.

The cost of uniforms or scrubs is deductible if they are required for your job and not suitable for everyday wear. The expenses for maintaining these uniforms, such as dry cleaning or laundering, are also deductible. You can also deduct the cost of work-related supplies like stethoscopes, medical shears, or penlights.

The tax treatment for these deductions varies. Due to the Tax Cuts and Jobs Act of 2017, W-2 employees cannot deduct unreimbursed employee expenses on federal tax returns, though some states still allow these deductions. For travel nurses who work as independent contractors (receiving a Form 1099), these professional expenses can be deducted on Schedule C of their federal tax return.

Understanding Tax-Free Stipends and Reimbursements

Many travel nurses receive stipends or reimbursements from staffing agencies to cover living expenses like housing, meals, and incidental costs. These payments are provided tax-free because they are considered reimbursements for expenses you incur while working away from your tax home.

You cannot deduct an expense that has already been paid for with a tax-free stipend. For instance, if your agency provides a $2,500 monthly housing stipend, you cannot also deduct your $2,500 rent payment as a travel expense. Doing so would result in an improper double tax benefit, as deductions are meant to offset out-of-pocket costs.

Deductions become possible only when your actual expenses exceed the amount of the stipend you receive. For example, if your rent was $2,800 per month and your stipend was $2,500, you could deduct the $300 difference you paid out-of-pocket. This requires meticulous record-keeping to substantiate that your expenses were greater than the reimbursement provided.

Essential Record-Keeping for Tax Purposes

Maintaining thorough and accurate records is necessary for any travel nurse who plans to claim tax deductions. In an IRS audit, you must be able to provide documentation to support all claimed expenses and your tax home status. Record-keeping should be a continuous habit throughout the year, not something left until tax season.

Your records should include copies of every work contract, which detail the location and duration of each assignment to prove its temporary nature. To substantiate transportation expenses with the standard mileage rate, a detailed mileage log is necessary. This log should include the dates of travel, starting and ending odometer readings, and the purpose of each trip.

For all other expenses, you must keep receipts, invoices, and bank or credit card statements. This includes receipts for lodging, utilities, professional fees, uniforms, and any work-related supplies you purchase.

You must also keep proof of your tax home maintenance. This can include mortgage statements, rent receipts, utility bills, or property tax bills for your primary residence.