If you’re thinking of working as a traveling speech, physical or occupational therapist, you’re probably thinking of how great it could be to travel around the country.
But you also might want to consider the potential tax benefits of work as a traveling rehab therapist.
You may see a significant tax advantage when you work as a traveling therapist. Understand that we’re not accountants, CPAs nor attorneys, so the following information you see here should be verified by a legitimate tax professional or lawyer.
However, the per-diem rates you’ll earn on a travel assignment may well give you a terrific tax advantage.
First of all, you should get to know the IRS’ per-diem tax rules intimately. You may read more at the IRS’ website and its publication 1542, Per Diem Rates for Travel Within the Continental United States.
In addition, tax prep software programs such as Quicken and TurboTax also can help you figure out how/if your per diem rates will help you with tax savings.
Here are two critical things of which you should be aware:
- You’ll have to have what the IRS calls a “permanent tax home,” and
- You’ll have to take what the IRS deems a “temporary” (less than a year) assignment away from that permanent tax home.
Basically, the IRS may let you claim deductions on your taxes for some travel expenses, or you may receive free tax reimbursements and tax-free per diem allowance payments. That is, you might be able to deduct a portion of your per diem income for every day you’re on a temporary assignment that takes you away from your permanent tax home.
Understand that not all companies that place rehab therapists in travel assignments pay per-diem allowances. They also may not pay enough in per diem or they may pay per diem as a part of your hourly rate. This is where speaking to a professional tax advisor will be of great value to you.
You also should know that the IRS’ per diem rules can change from year-to-year, so what you can deduct this year may change next year, so be sure to keep on top of the changes. Again, turning to a tax professional can be beneficial to you.
If you’d like to take advantage of all the benefits working as traveling therapist can give you — tax, lifestyle, financial — give us a call. Centra Healthcare Services offers speech, physical and occupational therapists assignments in rehabilitation facilities and hospitals all over the country. We look forward to hearing from you.