Locum tenens tax deductions
What locum physicians paid as independent contractors commonly deduct, where it goes on Schedule C, and what to keep.
Short answer
What can locum physicians deduct?
If you work locums as an independent contractor, you report your pay and business expenses on Schedule C, and you can deduct costs that are both ordinary and necessary for your work. For locums that commonly means travel and lodging on assignments away from your tax home, generally 50% of business meals, mileage, license fees and CME. Whether a cost qualifies, and how much, depends on your situation, so confirm with a tax professional.
Contractor or employee comes first
Deductions on Schedule C are for your own business. The IRS decides whether you are an independent contractor from how the work is controlled: you are one when the client has the right to direct only the result of the work, not what is done or how. The IRS names doctors among the professions who may be independent contractors, and a contractor's earnings are subject to self-employment tax.
Many locum contracts pay you as a contractor and report the pay on Form 1099-NEC. Some agencies or hospitals hire locums as W-2 employees instead, and then Schedule C doesn't apply to that work. Check each contract.
Is a locum tenens physician a 1099 contractor?
Often, but not always. Many locum agencies and hospitals pay physicians as independent contractors and report the pay on Form 1099-NEC, while others hire locums as W-2 employees. The IRS looks at who controls how the work is done, not the label on the contract.
Costs locums commonly record
These are costs physicians commonly track, with the Schedule C line they are usually reported on. None of them is automatic: each has to be an ordinary and necessary cost of your work, and you need a record of it.
| Cost | Schedule C line | What to know |
|---|---|---|
| Airfare, lodging, rental cars and rides to an assignment | 24a, Travel | Only while you are away from your tax home on temporary work. See the one-year rule. |
| Meals while traveling | 24b, Deductible meals | Generally 50% of the cost. You can use the federal M&IE rate instead of meal receipts. |
| Driving for work | 9, Car and truck expenses | The standard mileage rate or actual costs. Driving between home and a regular work location is commuting. |
| State license renewals and registration fees | 23, Taxes and licenses | Keep the receipt from each renewal. |
| Supplies you buy for work | 22, Supplies | Items the facility doesn't provide. |
| CME: courses, conferences and board review | Part V, Other expenses | Education that maintains or improves skills in your current work can qualify; education for a new profession doesn't. |
Physicians also commonly record malpractice or tail coverage they pay themselves, professional dues, and the business share of a phone. Health insurance premiums you pay as a self-employed person may be an adjustment to income on Form 7206 rather than a Schedule C expense.
Don't count a cost twice. If an agency or hospital paid you back for something, ask your tax professional how that reimbursement was reported before you deduct the cost. See tracking reimbursements.
IRS standard mileage rates
The business standard mileage rate can change during a year. In 2026 it did. For which drives count and what to record, see the mileage guide.
| Driving dates | Per mile |
|---|---|
| July 1 to December 31, 2026 | 76 cents |
| January 1 to June 30, 2026 | 72.5 cents |
| All of 2025 | 70 cents |
| All of 2024 | 67 cents |
In the app
How Shyft helps
Shyft keeps the records these deductions depend on, filed under the shift and assignment they belong to.
- A tax summary by year that groups your receipts by Schedule C line, counts meals at 50%, and leaves out personal receipts and whatever an agency already reimbursed.
- Possible deductions: prompts for costs physicians often forget, such as CME, malpractice or tail coverage, dues, license fees near a renewal, and recurring charges with no receipt.
- Mileage trips at the IRS rate for each trip's date, including the July 2026 change.
- An accountant package with the tax summary, income, work days by state, mileage and every receipt image, as a PDF and a zip.
Shyft is in beta for Android phones.
More questions
Can I deduct meals on a locum assignment?
Generally you can deduct 50% of business meals while you travel away from your tax home. Instead of keeping every meal receipt, the IRS lets self-employed people use the federal meals and incidental expenses rate for each travel day, and the 50% limit still applies.
What is the IRS mileage rate for 2026?
The IRS business standard mileage rate is 72.5 cents a mile for driving from January 1 to June 30, 2026, and 76 cents a mile from July 1 to December 31, 2026. For 2025 it was 70 cents a mile.
Can I deduct CME as a locum physician?
Education that maintains or improves the skills you use in your current work can be a business expense for a self-employed physician. Education that qualifies you for a new profession is not. Keep the certificate and receipt for each course.
Sources
- Instructions for Schedule C (Form 1040)IRS: who files Schedule C, the expense lines, and the 50% limit on business meals.
- Deducting business expensesIRS: the ordinary and necessary test.
- Independent contractor definedIRS: the control test, doctors as examples, and self-employment tax.
- Publication 463, Travel, Gift, and Car ExpensesIRS: travel away from your tax home, meals, the standard meal allowance and car expenses.
- Publication 970, Tax Benefits for EducationIRS: work-related education for self-employed people.
- Standard mileage ratesIRS: the business rate for each period since 2024.
- About Form 7206, Self-Employed Health Insurance DeductionIRS.
This guide is general information about US federal tax rules, not tax advice. Rules change and depend on your situation; confirm with a tax professional before you file. Shyft's tax summary is an estimate for record-keeping only.