What Can Nurses Write Off on Taxes: Deductions, Credits, and Mileage

If you work as a 1099 independent contractor, you can write off a long list of nursing expenses on Schedule C: license and certification fees, malpractice insurance, required uniforms and equipment, business mileage, continuing education, a home office, health insurance premiums, and retirement plan contributions. If you work as a W-2 employee, the federal answer to what nurses can write off on taxes is almost nothing: the Tax Cuts and Jobs Act suspended the deduction for unreimbursed employee business expenses in 2018, and the One Big Beautiful Bill Act made that elimination permanent in 2025. Your employment status, not your job title, decides which list applies to you.

Why Employment Status Decides What You Can Deduct

Most nurses are W-2 employees. A hospital or clinic withholds income and payroll taxes and issues a paycheck. A smaller group — travel nurses, consultants, some home health providers — work as 1099 independent contractors. The IRS treats independent contractors as self-employed business owners, which opens up Schedule C (Profit or Loss From Business) and the deductions that come with it.¹

For W-2 nurses, the federal picture is bleak. Before 2018, employees could deduct unreimbursed work expenses as miscellaneous itemized deductions above a 2% adjusted gross income floor. The Tax Cuts and Jobs Act suspended those deductions, and the One Big Beautiful Bill Act removed the expiration date, making the elimination permanent for 2026 and beyond.² If your employer requires you to buy your own stethoscope, scrubs, or continuing education courses and doesn’t reimburse you, you cannot write those costs off on your federal return.

Two things are worth knowing even so. First, if your employer reimburses work expenses through an accountable plan, the reimbursement isn’t taxable income to you, so the economics of pushing for reimbursement are better than they look. Second, a handful of states still allow W-2 employees to deduct unreimbursed business expenses on the state return, so check your state’s rules.

Everything in the self-employed sections below assumes 1099 status. The education credits and student loan interest deduction later in the article apply to both W-2 and 1099 nurses.

Licenses, Certifications, and Professional Dues

Keeping your credentials current is a deductible cost of doing business. State license renewal fees — generally between $68 and $190 depending on the state — go on Line 23 (Taxes and Licenses) of Schedule C.³ Specialty certifications like ACLS, PALS, or CRNA renewals work the same way, because they relate directly to your ability to practice in your specialty.

Dues to the American Nurses Association or specialty nursing organizations are deductible too, with one carve-out: the portion of dues that funds lobbying or political activity is not. Most organizations will tell you what percentage of annual dues is non-deductible for this reason.

Malpractice and Business Insurance

Professional liability premiums are deductible on Schedule C, Line 15. Malpractice coverage is squarely a business insurance expense for a self-employed healthcare provider.³ Individual nurse malpractice policies typically run between $106 and $828 per year depending on specialty and state, and the full premium is deductible. General liability, business property, and errors-and-omissions coverage go on the same line. Health insurance is treated separately — see below.

Uniforms, Equipment, and Supplies

Work clothing is deductible only if your job requires it and you wouldn’t wear it in everyday life. Scrubs embroidered with a facility logo, surgical gowns, lead aprons, and non-slip surgical shoes qualify. Plain sneakers or clothing you could reasonably wear outside work don’t, even if you only wear them at the hospital. Laundering costs for qualifying uniforms are also deductible, whether you use a service or wash them at home.

Medical tools are ordinary business expenses. Stethoscopes, diagnostic sets, penlights, and similar items can be deducted in full in the year you buy them. Depreciation or Section 179 expensing exists for larger purchases, but few individual nursing tools cost enough to need that approach.⁴ Personal protective equipment — respirator masks, face shields, goggles — is deductible when your duties require it. Keep receipts and note the business purpose for each purchase.

Mileage and Travel

Travel is one of the largest deductions available to self-employed nurses, especially travel nurses. The IRS standard mileage rate for 2026 is 72.5 cents per mile for business driving.⁵ You can use the standard rate or track actual vehicle expenses (gas, maintenance, insurance); pick one method and stick with it for the year.

When an assignment requires you to travel away from your tax home and stay overnight, lodging is fully deductible and meals are 50% deductible.⁶ Your tax home is the city or general area where your main place of business is located, not necessarily where your family lives — a distinction that trips up a lot of travel nurses.

An assignment has to be temporary, which the IRS defines as lasting no more than one year. Once an assignment extends past 12 months, the IRS considers it indefinite and you can no longer deduct travel costs for that location.⁶ Keeping a permanent residence you return to, maintaining a driver’s license and voter registration in your home state, and returning home at least once a year all help prove your assignments are temporary.

Driving between work sites during the day — say, between two home health patients — is deductible mileage. Driving from your home to a regular workplace is commuting, and commuting is never deductible.

Home Office

If you use a dedicated space at home regularly and exclusively for your nursing business, you may qualify for the home office deduction. It fits best for nurses who handle scheduling, billing, charting, or administrative work from home. The space can’t double as a guest bedroom or family area.

The simplified method allows $5 per square foot, up to 300 square feet, for a maximum deduction of $1,500.⁷ The regular method calculates the percentage of your home used for business and applies that percentage to actual housing costs (mortgage interest or rent, utilities, insurance, repairs). The regular method is more paperwork and often a larger deduction. W-2 employees cannot claim the home office deduction even when they work from home.

Continuing Education

CE expenses are deductible on Schedule C when the coursework maintains or improves skills in your current nursing role, or when state law requires it to keep your license active.⁸ Tuition, books, supplies, and travel for mandatory seminars all count. Online courses to stay current in wound care, pharmacology, or infection control are typical.

Two situations knock education out of deductibility: coursework that meets the minimum educational requirements for your current job, or coursework that qualifies you for a new profession.⁹ An RN pursuing a Nurse Practitioner degree is generally treated as qualifying for a new profession, not just improving existing skills. Same for an LPN studying to become an RN. That tuition is typically not deductible on Schedule C, though the education credits below can help.

Education Credits and Student Loan Interest (Available to All Nurses)

Two federal education credits apply regardless of whether you file as an employee or an independent contractor, which makes them especially useful for W-2 nurses who have lost the business expense deduction.

The American Opportunity Tax Credit covers the first four years of higher education and is worth up to $2,500 per eligible student per year. Forty percent (up to $1,000) is refundable, meaning you can receive it even if you owe no federal tax.¹⁰ The credit phases out as modified AGI approaches $90,000 (single) or $180,000 (joint).¹¹

The Lifetime Learning Credit is broader. It applies to undergraduate, graduate, and professional degree courses with no cap on the years you can claim it, and equals 20% of the first $10,000 in qualified expenses for a maximum of $2,000 per return. It is non-refundable, so it can zero out your tax bill but won’t generate a refund on its own.¹² The same MAGI limits apply.¹¹

Nurses repaying student loans can deduct up to $2,500 in student loan interest per year as an adjustment to income, available whether or not you itemize. For 2026, the deduction phases out for single filers between $85,000 and $100,000 MAGI, and for joint filers between $175,000 and $205,000.

Health Insurance Premiums

A self-employed nurse who is not eligible for a spouse’s employer-sponsored health plan can deduct 100% of health insurance premiums as an adjustment to gross income. The deduction covers premiums for you, your spouse, your dependents, and your children under age 27 even if they aren’t dependents.¹³ The plan has to be established under your business — either in the business name or in your own name as the sole proprietor.

This deduction goes on Schedule 1 of Form 1040, not on Schedule C. The distinction matters: it reduces your income tax but not your self-employment tax. You also can’t take it for any month in which you were eligible to participate in an employer-subsidized health plan, even if you declined to enroll.¹³

Retirement Plan Contributions

A SEP-IRA allows contributions of up to 25% of net self-employment earnings, with a maximum of $72,000 for 2026, and the contribution is deductible as an adjustment to income.¹⁴ A solo 401(k) offers the same $72,000 combined ceiling for 2026 with more flexibility: employee deferrals up to $24,500 plus employer profit-sharing up to 25% of net self-employment income, catch-up contributions after age 50, and the option of Roth contributions, which a SEP-IRA does not allow.

Pre-tax contributions reduce taxable income dollar for dollar, which puts this near the top of the list of effective deductions for a self-employed nurse earning solid income.

The Qualified Business Income Deduction

Self-employed nurses may be able to deduct up to 20% of qualified business income under Section 199A, which the One Big Beautiful Bill Act made permanent.¹⁵ It stacks on top of Schedule C deductions and does not require itemizing.

Healthcare is a “specified service trade or business” under the QBI rules, so the deduction phases out at higher income levels. Below the income threshold you can take the full 20% on net business income after Schedule C expenses; above it, the deduction shrinks and eventually disappears. The thresholds adjust annually for inflation, so check the current year’s figures. W-2 wages don’t qualify for QBI regardless of income.¹⁵

Tax Preparation Fees

The business portion of tax prep fees is deductible on Line 17 of Schedule C, including fees to prepare your business return, tax advice related to your nursing business, and the cost of resolving business tax disputes.³ Only the business share qualifies. If your preparer charges $500 and half the work was Schedule C, $250 is deductible. The personal portion is no longer deductible for anyone under the permanent elimination of miscellaneous itemized deductions.

Self-Employment Tax and Quarterly Payments

Deductions aren’t the whole picture for 1099 nurses. You also owe self-employment tax on net earnings, which covers both the employer and employee shares of Social Security and Medicare: 15.3% total (12.4% Social Security on earnings up to $184,500 in 2026, plus 2.9% Medicare on all earnings).¹⁶ An additional 0.9% Medicare surtax applies to self-employment income above $200,000 ($250,000 joint).

Half of your self-employment tax is deductible as an adjustment to income on Schedule 1, which reduces your income tax but not the self-employment tax itself.³ Because no one withholds taxes from your pay, you also need to make quarterly estimated payments. You can avoid underpayment penalties by paying at least 90% of your current-year tax or 100% of last year’s (110% if prior-year AGI exceeded $150,000).¹⁷ Many self-employed nurses use the prior-year safe harbor because income can be unpredictable.

Keep Records That Hold Up

Every deduction on this page depends on documentation. The IRS doesn’t require a specific format, but you need enough records to show each expense was real and business-related. Save receipts with the date, amount, vendor, and item. For mileage, log the date, destination, business purpose, and miles driven; a spreadsheet or app is fine if entries are made close to the trip.

Note the business purpose at the time of purchase for equipment and supplies. “Stethoscope for patient assessments” written on or attached to a receipt goes a long way if the IRS ever asks. Bank and credit card statements alone usually aren’t enough — they show you spent money, not why. Pair them with receipts, invoices, or a contemporaneous log and your deductions will hold up.

1
Internal Revenue Service. About Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship)
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Office of the Law Revision Counsel. 26 USC 67 – 2-Percent Floor on Miscellaneous Itemized Deductions
3
Internal Revenue Service. Instructions for Schedule C (Form 1040)
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Internal Revenue Service. Topic No. 704, Depreciation
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Internal Revenue Service. 2026 Standard Mileage Rates
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Internal Revenue Service. Topic No. 511, Business Travel Expenses
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Internal Revenue Service. Simplified Option for Home Office Deduction
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Internal Revenue Service. Topic No. 513, Work-Related Education Expenses
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Internal Revenue Service. Publication 970 (2025), Tax Benefits for Education – Section: 11. Business Deduction for Work-Related Education
10
Internal Revenue Service. American Opportunity Tax Credit
11
Internal Revenue Service. Education Credits – AOTC and LLC
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Internal Revenue Service. Lifetime Learning Credit
13
Internal Revenue Service. Instructions for Form 7206
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Internal Revenue Service. SEP Contribution Limits (Including Grandfathered SARSEPs)
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Internal Revenue Service. Qualified Business Income Deduction
16
Social Security Administration. Contribution and Benefit Base
17
Internal Revenue Service. Underpayment of Estimated Tax by Individuals Penalty