For those who work hard for their money, there are few things as satisfying as finding ways to save. And nurses work harder than most. With that in mind, there are a number of ways that nurses can save on their taxes this year.
Tax deductions are a common practice, and the process is simple. The amount an individual is taxed is based on their income, and different incomes are separated into different tax brackets. In short, reducing your taxable income reduces how much tax you’ll owe.
According to Nurse Journal, money spent on the job or spent maintaining a nursing license can be deductible from a person’s adjusted gross income. However, it’s important to note that many nursing deductions now fall under ”miscellaneous deductions” following the Tax Cuts and Jobs Act of 2017.
Several of those deductions once allowed individuals a 2% adjustment to their gross income, but have since been eliminated. Those deductions include work shoes, union dues, uniforms, subscriptions to professional journals and work-related device purchases.
Discuss possible deduction opportunities with your accountant to ensure you maximize these federal tax saving opportunities.
On the state level, nurse-related tax deduction opportunities vary based on where you file. Some deductions are no longer acknowledged on the federal level, but can still help you save money on state taxes. Travel expenses, professional licensing fees and moving expenses related to a new job are just some of the ways that nurses can reduce their state taxable income.
Travel nurses should be wary of potential taxation on their stipend payments — payments made to help travel nurses pay travel expenses — as well. To avoid being taxed on these payments, travel nurses will need to prove to the IRS that they have a “tax home.”
Every nurse’s circumstance is unique, so be sure to visit irs.gov for a bevy of useful IRS toolkits that will make filing taxes easier this year.
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