ax Deductions for Nurses: How to Stop Leaving Money on the Table

Financial Horizons: Insights for Building Wealth and Securing Your Legacy

By Dr. Jose G. Cardenas, Chief Tax Strategist at The C & R Group, LLC

If you’re a nurse, you give everyone else peace of mind—patients, families, doctors, hospitals. But when tax season hits? Nobody is lining up to protect your wallet.

Here’s the truth: nursing is one of the most demanding careers out there, and the mix of shift work, overtime, agency contracts, travel assignments, and nonstop training can make your taxes more complex than you realize.

Handled correctly, some of those costs you shoulder—education, uniforms, equipment, even certain medical expenses—can help reduce your tax burden. Handled poorly, they’re just more money out of your pocket.

Let’s break down a few key tax opportunities nurses should know about and where the rules get tricky.

First: Are You a W-2 Employee or a 1099/Contract Nurse?

Before we talk deductions, we need to talk how you’re paid:

• Many staff nurses are W-2 employees of a hospital, clinic, or health system.
• Travel nurses, agency nurses, nurse consultants, and some PRN/contract roles may be paid as independent contractors (often via 1099).

Why this matters:

• For most W-2 employees, unreimbursed job expenses (like uniforms, mileage, equipment) are no longer deductible on your federal return under recent tax law changes—those “miscellaneous itemized deductions” have been suspended for most workers. IRS+1
• If you’re self-employed or truly working as an independent contractor, many of those same costs may be treated as business expenses, which can still be deductible. IRS

State rules can be different, and this is exactly where a tax pro who understands healthcare can protect you from both overpaying and making risky claims.

With that foundation set, let’s walk through the main areas nurses ask about.

1. Nursing School Tuition & Education Costs

Nursing school isn’t cheap—but some of those education dollars can still work for you at tax time.

Depending on your situation, you may potentially benefit from:

• Education tax credits (for qualifying tuition and fees at eligible schools)
• Student loan interest deductions, if you’re paying back nursing school loans and meet income limits
• Possible employer education benefits, which may be tax-favored if structured properly

Key moves for nurses:

• Keep every tuition statement you receive from your school or loan servicer.
• Track what you personally paid vs. what scholarships, grants, or employers paid.
• Talk with a tax professional to determine whether a credit or a deduction is more favorable in your situation.

Education is an investment in your career—don’t miss the tax advantages that come with it.

2. Uniforms and Work-Related Equipment

Scrubs, non-slip shoes, stethoscopes, trauma shears, pen lights… the list of gear you buy yourself can feel endless.

How these expenses are treated depends heavily on how you’re classified:

• W-2 staff nurses: Under current federal rules, most unreimbursed employee expenses—including uniforms and tools—are not deductible as miscellaneous itemized deductions. IRS+1
• 1099/independent contractor nurses: Scrubs, required uniforms, tools, licensing fees, and some other job-related costs may be legitimate business expenses when they are ordinary and necessary for your work.

Either way, build the habit of keeping:

• Receipts for uniforms and shoes
• Proof of equipment purchases (stethoscopes, medical tools, reference books)
• Employer policies on uniform reimbursement or dress codes

If you ever move into contract or self-employed work, that record-keeping discipline will immediately start paying off.

3. Continuing Education & Professional Development

Nursing doesn’t stop at graduation—CEUs, certifications, and training are a way of life.

Some examples:

• ACLS, PALS, TNCC, and other certifications
• Conferences and specialty training
• Online CEU courses to maintain your license

For self-employed/contract nurses, many of these costs may be treated as business expenses if they maintain or improve skills required in your current work.

For W-2 nurses, some education may instead fall under the umbrella of education credits or employer education programs, or it may not be deductible at all under current federal rules.

Bottom line:

• Save receipts for course fees, books, and required materials.
• Note whether your employer reimbursed part or all of the cost.
• Get professional advice on whether those costs are currently deductible in your exact situation and state.

4. Mileage and Work-Related Travel

Nurses are on the move:

• Floating between facilities
• Driving to home health visits
• Traveling to temporary assignments or training sites

Again, classification matters:

• For most W-2 employees, unreimbursed job mileage is not deductible on the federal return under the suspended miscellaneous itemized deduction rules. IRS
• For self-employed or 1099 nurses, mileage used for business (not commuting to your primary work site) can often be a valid business expense, tracked either by standard mileage rates or actual expenses.

If you’re a travel nurse or contract nurse, a detailed mileage log (dates, destinations, purpose, and miles driven) can be worth real money at tax time.

And even if you’re W-2, strong records put you in a better position if tax law or your work structure changes in the future.

5. Medical Expenses Not Covered by Insurance

Ironically, even the people who care for others often face high medical costs themselves. Some of those out-of-pocket expenses may help reduce your tax bill.

If you itemize deductions and your unreimbursed medical expenses are high relative to your income, certain costs may be deductible according to IRS rules, including: IRS

• Doctor and specialist visits
• Prescription medications
• Certain procedures, therapies, or medical equipment
• Some long-term care expenses
• Insurance premiums in specific situations

Key habits:

• Keep an annual folder labeled “Medical – [Year]” with receipts and insurance explanations of benefits (EOBs).
• Separate what you paid out of pocket from what insurance actually covered.
• Ask a tax pro whether you’re close enough to the threshold where itemizing medical expenses makes sense for you.

Even if you don’t benefit every year, a year with major medical events can produce meaningful tax relief—if you’ve kept good records.

Why Nurses Should Consider Working With a Tax Professional

Your work is literally life-and-death. Your tax situation? Maybe not—but it does affect the life you’re able to build outside the hospital.

A tax professional who understands nurses and healthcare can help you:

• Navigate the difference between W-2 and 1099 work
• Decide if a contract/locum setup should be treated as a business
• Coordinate tax planning with your student loans, retirement savings, and family goals
• Avoid risky deductions that don’t match current law
• Make sure you’re not leaving money on the table year after year

You show up for everyone else. It’s okay to let someone show up for you when it comes to taxes and strategy.

Final Thoughts: You Care for Others—Let Your Tax Plan Care for You

You’ve chosen a career built on service, sacrifice, and strength. The tax code isn’t going to automatically reward that—but smart planning can.

By:

• Understanding which expenses may be deductible in your situation
• Tracking education, uniforms, equipment, mileage, and medical costs
• Getting guidance on W-2 vs. 1099 rules and state differences
• Partnering with a strategist who knows how to protect healthcare professionals

…you can keep more of what you earn and direct it toward what matters most—your family, your future, and your financial freedom.

🔗 Read more at: www.thecrgroupllc.com/blog

📅 Book your consultation: Book a consultation with Dr. Cardenas

About the Author

Dr. Jose G. Cardenas is a retired U.S. Army Finance Officer and the Chief Tax Strategist at The C & R Group, LLC. With a Doctorate in Business Administration and over 20 years of experience in financial strategy and tax planning, Dr. Cardenas helps individuals and business owners—including healthcare professionals—protect their wealth and build a legacy. Learn more at www.thecrgroupllc.com

📌 Disclosure

This article is for educational and informational purposes only and is not intended to serve as personalized legal, tax, or investment advice. Tax laws are complex and subject to change, and deductions vary based on employment status, income level, and federal and state rules. You should consult with a qualified tax professional about your specific situation before making any decisions. Dr. Jose G. Cardenas, DBA, provides tax advisory services through The C & R Group, LLC. Insurance strategies, including Indexed Universal Life (IUL) and annuity products, may be offered through his role as a licensed financial professional affiliated with Experior Financial Group.

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