Managing Your Taxes While Working Locum Tenens

Whether you are a seasoned professional working locum tenens assignments full time or a physician interested in moonlighting to supplement your income, conquering the maze of confusion at tax time can be a daunting task.

Whether you are a seasoned professional working locum tenens assignments full time or a physician interested in moonlighting to supplement your income, conquering the maze of confusion at tax time can be a daunting task. Locum tenens physicians can prepare themselves in advance making the process of filing tax returns easier by educating themselves in the beginning.

If you are just starting out on your first locum tenens job, it is advisable to consult an accountant early in your locum tenens career. Some locum tenens physicians wait until it is time to file a return only to find that there are records that should have been kept to make crucial deductions on their return. An accountant can also advise locum tenens providers in regards to making estimated tax payments on earned income avoiding any surprises and penalties at year end.

One important thing to keep in mind when practicing as a locum tenens physician is that you are classified as an independent contractor. Unlike a permanent physician, you are considered a self -employed party where the IRS and state tax agencies are concerned. Most locum tenens physicians are aware that they are responsible for income taxes on the wages they earn, but some make the costly mistake of forgetting about Social Security and Medicare taxes.

Record Keeping is Vital

Many locum tenens physicians will tell you that investing in record tracking software is a highly useful investment. Taking the time to input your expanses after each locum tenens assignment will prove to be a beneficial task when it comes time to determine your deductions.

As an independent contractor you will receive a 1099 at year end as opposed to a W-2 for each locum tenens assignment worked. Make sure that you retain your check stubs from each locum tenens job worked and verify the 1099’s for accuracy. If you find an error, notify the proper agency immediately and request a corrected 1099.

Locum Tenens Deductions

Depending on your income and financial circumstances locum tenens physicians find that taking advantage of deductions is a huge help when it comes to maintaining their locum tenens income.

Common deductions locum tenens physicians can take advantage of are:

Travel, transportation & lodging

Meals while working a locum tenens job

Medical license fees

Subscriptions to medical journals, educational material etc.

CME

Retirement plan contributions

Health insurance contributions

Internet and Cell phone bills

Multi-State Locum Tenens

Some locum tenens physicians work physician jobs in a number of states. It is imperative that locum tenens physicians understand the importance of tracking your locum tenens assignments by location and file returns appropriately. A tax professional may become necessary in determining what returns are needed to be filed.

Planning ahead and enlisting the help of a competent tax professional are keys to successfully managing your locum tenens physician income. Once you have gained the experience and knowledge to manage your deductions and maintain your physician salary you will find that you prefer the independent contractor status locum tenens physicians nation-wide prefer.

About the Author

Amy Cline Amy Cline is the author of this article on locum tenens jobs. Find more information, about emergency medicine residency here