Bonuses? Should you accept them?
That's my brother in the picture with me. What up Daniel!
A word about Bonuses for Travel Nurses, Travel Therapist or Travel Radiologists.
They are great for marketing but not always the best for us to accept.
Bonuses are taxed. Stipends and reimbursements are not.
Hmmm. Yup, I want the stipend, please!
Before you accept a bonus remember that it is coming out of your pay package. That’s right, your company is not going into debt to give you that bonus. Almost always it is not cutting into their profit margins at all.
They are just moving your money around to make you more excited about working with them.
For marketing, it’s excellent. You are scrolling through jobs and see one comes with a $1000 bonus!! Oooo. It got our attention.
But we are too smart not to look a little deeper and ask for that money in a different form.
1. If a marketing team decided to give bonuses out to bring in new travelers. Cool. You are an empowered traveler, and you know what to do.
2. Ask if it is possible to put that bonus money back into tax-free money somewhere. If yes, go for that first. Use bonuses as a last resort.
3. If our meals and incidentals + housing stipends are not maxed out, then they should be able to put money in our tax-free stipends/reimbursements first. (GSA.gov tells us the max we are allowed to get legally. The recruiter does not decide this, the government does)
4. If it is maxed out- lucky you- sounds like a-rockin' bill rate. Go enjoy your bonus. Or ask to put it towards a CEU reimbursement you really want making it again, tax-free.
What about extension bonuses?
Each company has to decide for themselves how to handle the non black and white guidelines the IRS gives us as an industry.
One of the words that pop up a lot is "re-characterizing wages." Just know, companies are not supposed to re-characterizing wages.
So if this is an extension bonus, not all companies will choose to raise the tax-free stipends depending on how they decide to interpret the rules. And some do. That is their interpretation of the laws, and I am not saying what is right or wrong, only teaching different perspectives.
But keep in mind, we get those stipends to cover our cost of living. The company may have a hard time explaining to the IRS why they change the reimbursements for the same location suddenly after 13 weeks.
So for an extension, a company may offer you a bonus or increase your taxable rate instead of putting it in your reimbursement pot.
Two Kinds of Bonuses
1. A bonus from the hospital or facility.
In this bonus, the hospital told the recruitment company “We will pay a traveler xxx dollars after completing xxx hours.” In this case, the money is not coming from your bill rate or pay package. The recruitment company would not get that money until you finish those hours. So you can’t really move that money to another spot.
2. A bonus offered straight from the recruitment company.
You know this is the case is they are offering everyone a bonus for their first assignment with them. For example: If it is on their website “New travelers get 500 dollars for signing on with us!”. In this scenario, the bonus is from them, and they are taking money from your pay package and just calling it a bonus for marketing reasons. This is the type of bonus we are talking about in this lesson.
Laura & the Nomadicare Team xo
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