Locum Tenens Anesthesiology: Tax Guide for High Day-Rate Assignments

Locum day rates vary enormously by specialty. Primary care and psychiatry locums often work at day rates in the low-to-mid four figures; anesthesiology, along with a handful of other procedural and surgical specialties, routinely commands some of the highest rates in the locum market. A physician taking anesthesia assignments at $2,000–$4,000+ per day, or an equivalent high hourly rate, can reach six-figure annual 1099 income working a fraction of a full-time schedule.

That income velocity is the whole reason this guide exists. Tax planning tools like the S-corp election, retirement plan contributions, and quarterly payment strategy aren't specialty-specific in how they work, but the speed at which they become worth doing is directly tied to how much income you're generating and how quickly it arrives. Anesthesia locums typically hit the thresholds where these tools matter sooner than physicians in lower-day-rate specialties, sometimes within their first year of full-time locum work.

As a straight 1099 contractor, all of your net self-employment income is subject to self-employment tax, 15.3% up to the Social Security wage base, then 2.9% (plus a 0.9% Additional Medicare Tax at higher income levels) above it. An S-corp election doesn't eliminate this tax, but it changes what it applies to: once you elect S-corp status, you pay yourself a reasonable salary (subject to payroll tax, which functions like self-employment tax), and the remaining profit can be distributed to you as a dividend that isn't subject to self-employment or payroll tax.

The savings from this structure scale directly with your income above the reasonable salary level. That's exactly why high-day-rate specialties like anesthesiology hit the break-even point sooner: the gap between your total 1099 income and a defensible reasonable salary for anesthesiology work opens up faster than it does in lower-paying specialties, because the ceiling on what counts as "reasonable" doesn't rise nearly as fast as your actual earnings do.

A structuring question specific to anesthesiology locums is how income flows when you're working under, alongside, or supervising a Certified Registered Nurse Anesthetist (CRNA) arrangement. Depending on the facility and staffing agency, this can take several forms:

• Direct individual 1099 — the facility or staffing agency pays you directly as an independent contractor for your own services. This is the simplest case, and the S-corp and retirement planning tools discussed elsewhere in this guide apply cleanly.
• Billing through a group entity — you're paid by, or split revenue with, an anesthesia group or CRNA supervision group that itself contracts with the facility. In this structure, your income may arrive as a 1099, a K-1 from a partnership, or wages from the group entity, depending on how that group is organized.
• Supervision/collaboration fee arrangements — some structures include a supervision or medical direction fee tied to overseeing CRNA-delivered anesthesia care, which may be reported separately from your direct clinical billing.

The structure matters because it determines whether you are the one making the S-corp election on your own 1099 income, or whether the group entity's own structure controls how the income is ultimately taxed to you. If you're receiving a K-1 rather than a 1099, the self-employment tax and S-corp planning discussed in Section 02 may not apply the same way, and the planning conversation shifts to how the group entity itself is structured.

This is general educational information about how these arrangements commonly work, not a review of your specific contract. If you're unsure how a CRNA supervision or group billing arrangement you've been offered will be taxed, get the actual contract reviewed before signing, not after your first 1099 or K-1 arrives.

A W-2 physician has taxes withheld automatically from every paycheck, evenly, all year. A 1099 anesthesia locum has none of that. Instead, you're responsible for calculating and paying quarterly estimated taxes yourself, and because anesthesia assignments often arrive in concentrated blocks, a few weeks of intense high-day-rate work followed by gaps, your income for the year doesn't arrive in the smooth, predictable pattern the standard quarterly estimate calculation assumes.

This creates a specific practical problem: if you estimate your quarterly payment based on a simple 1/4-of-expected-annual-liability calculation, you can badly underpay in a quarter where you had light assignment volume, and then owe a disproportionately large payment in a quarter where a big block of high-rate work landed.

For the full mechanics of quarterly payment calculation, safe harbor thresholds, and payment scheduling, see our Estimated Tax Payments guide for 1099 physicians.

Illustrative example, not a specific client outcome. Dr. Reyes is a locum anesthesiologist billing $450/hour. Working roughly 1,000 billed hours across the year, roughly 20 hours/week averaged over assignments, produces $450,000 in gross 1099 income. After deducting ordinary business expenses (malpractice tail coverage, licensing, travel between assignments, CME, professional fees), assume $400,000 in net self-employment income.