Independent Contractor

What types of independent nurses provide patient care?

Registered nurses can provide nursing services in the patient’s home. The patient pays for the services. The nursing care must follow the state’s nurse practice act. NANDA nursing diagnosis and care plans can be used to standardize care. Holistic nurses are independent practitioners. The services provided must fall within the position statement issued by the state nurse practice act. Nurses who practice holistic nursing do not need advance degrees or physician collaboration for many services. Nurse practitioners can diagnose and treat; but a medical collaborator and/or supervision is needed in some states. Higher education is required in the form of a masters in nursing. Requirements are different in different states. Esthetic nurses provide cosmetic treatments ordered by a physician. In most states, the physician does not have to be on site.

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How much can I earn as an independent nurse contractor?

If you are working alone as a independent contractor, the earnings are limited to the number of hours you can physically work. The earnings vary by location and are often the same as working on the high end of the pay scale at a hospital in that same locale. Nurse practitioners’ bill rates are higher than an RN’s. If you have employees, the amount is based on the number of employees multiplied by the number of hours  worked minus employee expenses and wages.

What is the startup cost for an independent nurse contractor?

The startup cost for an RN nursing service is relatively low.  As an RN, you are licensed to practice as a nurse; therefore, you are not required to start a sole proprietorship, limited liability company (LLC), or a corporation. The book, Self-Employed RN: How to become a self-employed RN and/or business owner contains a complete outline of startup costs. No business loans or grants are available for startup. You can personally loan your company startup funds. Your company can pay you interest and repay the loan as money is available. Personal computers, software, printers, and other equipment and supplies used by the company can be purchased or leased by your company from you personally. The Internal Revenue Service (IRS) requires that personal and business expenses and equipment be held separately. No personal business should be done on company computers or equipment.

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Will nurse independent contractors be around in the future?

The future for this industry is good based on the shortage of nurses and the continuing increased demand for nurses forecasted for the future.

Do I need more education to be an independent nurse contractor?

No advanced nursing degrees are needed. You need to be an RN. Business education is needed for nurses to understand the business aspects of being self-employed or a small business owner. The association provides this education customized for nurses. College and community business courses do not understand the nursing community. Advanced nursing courses do not teach self-employment and small business ventures.

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As a nurse contractor, should I be a sole proprietorship, an LLC, or a corporation?

A corporation affords the most tax deductions, benefits, and liability protection. The owner is not personally liable for the debts or judgments incurred by the corporation. LLC and sole proprietorship are not the best choices. The NNBA recommends that your business be incorporated to protect your personal assets from the debt of the business and to be eligible for tax exceptions available to small businesses. Providing your services as a LLC and/or corporation does not relieve you of responsibility for your nursing actions or protect your personal assets from judgements related to your actions as a nurse. You are personally responsible as long as you are a licensed RN.

Do I need some specific industry code for tax purposes to be a nurse contractor?

The North American Industry Classification System (NAICS) provides the official industry classification system with numeric codes. Proper classification is necessary for tax and regulatory purposes.

Is there anything about independent contracting that could cause problems?

Nurses who work for healthcare temporary staffing services (nursing agency) are employees, not independent contractors according to the IRS. The determination of worker status is determined by the IRS, not the worker or the employer. The nurse who works as an independent contractor could be responsible for back taxes and penalties to the IRS. Check with your accountant if you have any questions regarding your status.

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