Making Sense of Taxes, Benefits, and Liabilities on the Road

You may find yourself unsure of whether you’re a 1099 independent contractor or a W-2 employee, and you're not alone in this! We're often asked if Jackson Therapy Partners travelers are W-2 employees or 1099 contractors, and all JTP travelers are W-2 employees. We’re going to break down the difference between the two, so you’ll have a complete understanding of what being on a travel contract means. 

Taxes as a W-2 employee VS. 1099 independent contractor

One of the biggest differences between W-2 employees and 1099 independent contractors is how taxes are paid! As a W-2 employee, you're a direct employee of the company, which means the company will allocate your taxes accordingly when running payroll. This also means you'll receive a W-2 every year from your employer to determine whether you owe any additional taxes at the end of the year or if you might get a refund. Companies that hire 1099 independent contractors do not allocate any taxes on your behalf, so you will receive a paycheck that does not include any tax deductions. As a result, you may owe taxes to your state and/or the IRS at the end of the year, but you’ll need to consult with a tax professional on a 1099 contract to understand more fully your responsibilities upon getting paid.  

Will I Receive Benefits as a traveling therapist? 

The short answer is – yes! As a W-2 employee, you’ll receive the employee benefits offered by your agency! With Jackson Therapy Partners, you receive benefits starting day one of your contract, which include a comprehensive Cigna health plan, matching 401(k), license reimbursement, and so much more. As a 1099 independent contractor, you typically don't receive any employee benefits, but that depends on your employer. More frequently, 1099 contractors are responsible for paying self-employment taxes, purchasing their own health insurance, and managing their own retirement savings.   

Professional Liability Differences