Last update: Nov 17, 2017
Although the tax reform plans that were recently passed by the House and the Senate could reduce federal income taxes for many Americans, as it currently stands healthcare travelers could be among the losers.
Under the current proposals, traveling health professionals who work as regular employees could lose the ability to deduct unreimbursed expenses for things such as license renewal fees, uniforms, mileage and continuing education according to Joseph Smith, a traveling respiratory therapist turned accountant and president of TravelTax.
“The proposed changes eliminate deductions for out-of-pocket expenses that typically exceed per diem rates and travel stipends in favor of higher standard deductions,” Smith explained.
“Depending on the circumstances, a travel assignment may have less appeal. Especially, if agencies decide to increase reimbursement rates and lower wages.”
Even worse, travelers – and other taxpayers – may lose the ability to write off mortgage, rent or utility costs for a primary residence as well as the cost of COBRA or medical expenses.
However, it’s important to point out that the standard deduction may also rise so your taxes could actually be lower under the current proposal. There’s no way to tell how the proposed changes will impact you unless you crunch the numbers.
Although it’s too early to panic as the two chambers still need to iron out their differences and create a single bill, at the very least the proposals require a call to action and perhaps a change in your flexible work arrangements. Just in case, here are some steps you might want to take.
What is a non-compete clause?
A non-compete clause (also called a do-not-compete agreement, or more whimsically a faithless servant doctrine) in an employment contract is a hiring restriction.
What is it for?
It is intended to limit your choices of other employers (competition) or protect or maximize an employer’s investment in your services. Typically this means protecting trade secrets, confidential information or an investment in an employee’s training and skills.
Overtime Rate Negotiation
This is an interesting subject. Most travelers are surprised to learn that overtime is something that can be negotiated like any other item. Here are some examples: everyone is familiar with negotiating your base rate. If you negotiate the base rate down, perhaps due to an upgrade in housing, or a tax free reimbursement, why should your overtime rate suffer and the agency benefit? Many travelers are also familiar with agencies that pay double time for overtime instead of the usual time and a half. How is it possible for them to do this? And there are number of agencies who pay less than time and a half for overtime. Is that legal?
- There are several methods of setting overtime pay.
Generally speaking, all methods are legal.
- Overtime is negotiable just like any other contract item.
In fact, almost any rate an agency pays for overtime is legal. In many states, overtime laws have been interpreted to mean time and a half based on state or federal minimum wage. All healthcare professionals make substantially more than that, limiting intervention by state labor departments. Recent federal laws passed further obscure the issue of overtime (for nurses) as they define nurses as supervisory personnel exempt from overtime regulations. While it this legislation turns out to be a red herring for hourly employees, it is still misunderstood by some employers and even some lawyers.
For the purposes of this article today, we will ignore labor legislation and agree that as contract employees, overtime is governed solely by our contracts with the agency. Realizing this gives the traveler the freedom to negotiate a contract based on not only the traveler's individual work patterns, but also on the ability of agency to pay a fair percentage of the bill rate they receive for your hard work.
What you need to take on an assignment depends on your type of housing. Obviously, if you will be housed in an extended stay or corporate housing where all linens and kitchen ware is supplied, this list will be vastly shorter. For the average traveler who is going to be living in the average one-bedroom apartment, furnished with basic furnishings only, you will need to take quite a few things.
Optionally, you can choose to purchase what you need after arrival to the assignment. Dollar stores and garage sales are an easy, cheap and often fun way of providing many of the items that you need. Donating your purchased items after your assignment at the local Goodwill helps the community and provides a tax deduction for you.