Tax Day is approaching, and if you worked locum tenens last year, you probably have a few questions about filing your income taxes. The process is a little different for contract workers versus hospital employees, but not to worry! Here are the answers to locum physicians’ most frequently asked questions during tax season.
Will I receive a W2 form from the hospitals I worked for?
As independent contractors, locum tenens physicians receive the 1099-MISC form rather than a W-2 to file their income taxes. You can expect to receive a 1099 from each company that paid you more than $600 by January 31st. If you do not receive your 1099 form by February 15th, you should contact the IRS at 1-800-829-1040.
Do I need to pay income taxes for contract work throughout the year?
If you expect to owe $1000 or more in taxes for the year, the IRS requires you to pay estimated taxes quarterly. You can do so using Form 1040-ES, which contains a worksheet to calculate your estimated taxes as well as four payment vouchers which you can send along with a check or money order. You can also make these payments online at the IRS website.
Can I make deductions for travel expenses?
If Fusion or another company has reimbursed you for travel and lodging, then you cannot claim these deductions. If you have unreimbursed travel expenses, then you must also meet these criteria to be considered a qualified traveler:
- You must have a permanent tax home which you pay expenses for and return to regularly
- You cannot work in the same area for more than a year without a significant break
If I worked in multiple states, do I need to file tax returns for each of them?
Yes, you will need to file taxes for each state in which you worked. In order to qualify for the most deductions in your home state, we recommend that you file for your non-resident states first and for your resident state last.
We hope we answered some of your big questions about filing taxes as a locum physician. If you have a concern we didn’t address, please feel free to leave a comment below.
The information in this post is compiled from public sources and is not meant to be taken as tax advice. It cannot be used to avoid tax penalties from the IRS or any state.