If you’re a travel nurse, therapist, or healthcare professional working as a 1099 contractor, the new federal tax law—H.R. 1, also called the “One Big Beautiful Bill”—brings a number of changes that may directly affect your return this year.
Below, we break down the most relevant updates and what they mean for your current and future tax planning.
The Qualified Business Income (QBI) deduction—allowing eligible independent contractors to deduct 20% of their net business income—has been made permanent. This change brings long-term certainty to the taxation of self-employed income.
If you operate as a sole proprietor, LLC, or S-Corp, you may continue to claim this deduction, subject to income limits and wage thresholds.
This is a key reason why many 1099 professionals consider forming an LLC or electing S-Corp status when income crosses the six-figure mark.
The cap on State and Local Tax (SALT) deductions has increased from $10,000 to $40,000 through 2029 for taxpayers with income under $500,000.
If you’re a contractor in a high-tax state and have previously been limited in how much you could deduct, this is worth a closer look—especially if you typically itemize deductions.
You can now deduct more business expenses up front thanks to expanded Section 179 and bonus depreciation rules. This applies to qualified equipment, software, and other eligible tools used in your business.
Examples:
● Medical or therapeutic equipment
● Laptops and tablets for EMR or scheduling
● Mobile carts or gear used during travel
● Home office tools or furnishings
If you’re planning upgrades before the end of the year, these changes may reduce your 2025 tax bill more than you expected.
New through 2028:
● Up to $25,000 in tips
● Up to $12,500 in overtime income (or $25,000 for joint filers)
These are above-the-line deductions, meaning they reduce your adjusted gross income directly. Eligibility is income-based and phase-outs apply. Proper documentation will be important to ensure compliance and benefit.
If you’re still working at age 65 or older and your income is below $75,000 ($150,000 jointly), you may now deduct an additional $4,000. This is a temporary benefit available through 2028.
● Adjust your estimated tax payments based on the deductions you’re now eligible to take.
● Review your business structure. The QBI deduction is now permanent—ensure you’re structured to benefit.
● Track tips and overtime separately to make year-end filing easier if you plan to claim the new deductions.
● Make qualifying purchases before year-end to maximize 2025 deductions under Section 179.
● Plan ahead. The tip, overtime, and senior deductions expire in 2028. These may influence how you manage income and expenses over the next few years.
At Accolade Accounting, we help healthcare professionals build tax strategies that reflect how you work—across shifts, states, and specialties. If you’re unsure how the new law affects your next return, we’re here to help.
Contact us today to schedule a consultation. Let’s make sure your 2025 tax strategy reflects every opportunity available to you.
When it comes to reliable accounting services in Atlanta, GA, look no further than Accolade Accounting. With a highly experienced accountant team, we have assisted numerous businesses in developing and implementing effective accounting systems. If you need expert guidance, don’t hesitate to contact our certified public accountants, call 470-646-2663
