Locum Tenens Taxes in Florida

Two things make Florida the default answer when locum physicians ask where to base their tax home. First, Florida has no state individual income tax, so W-2 or 1099 locum income earned while genuinely domiciled there isn't taxed at the state level at all. Second, Florida has an unusually deep locum tenens job market: a large and growing population, a heavy concentration of retirees driving demand for internal medicine, cardiology, and emergency specialties, and pronounced seasonal swings as the "snowbird" population arrives each winter and strains coverage at hospitals and clinics statewide. For a locum physician, that means Florida isn't just tax-friendly, it's also one of the easiest states to stay booked in year-round.

Put those two facts together and the appeal is obvious: live where you can also work a lot, and don't pay state tax on what you earn doing it. But the tax benefit only exists if your Florida tax home is real, not a convenient fiction layered on top of a life you're still actually living somewhere else.

The Documentation That Actually Holds Up

High-tax states such as California, New York, and New Jersey are aggressive about auditing former residents who claim to have moved to Florida, precisely because the incentive to fake it is so large. A residency audit doesn't ask whether you like Florida; it asks whether you actually live there. The following items are what auditors and, if it comes to it, courts actually look at.

Here's the case that trips people up in the other direction. Say you live in California, your spouse's job is there, your kids are in school there, and you take a 13-week locum assignment at a hospital in Tampa. Does that Florida assignment create any Florida tax benefit for you?

No, and it doesn't need to. Florida taxes nobody's income, so working there as a nonresident on a temporary assignment doesn't expose you to any new tax, but it also doesn't shelter you from any tax you already owe. Your domicile is still California. California taxes its residents on their worldwide income, which includes every dollar you earn on the Tampa assignment, exactly as if you'd earned it at a hospital down the street from home.

This matters because some physicians assume that simply working in a no-tax state creates a tax benefit, the same way working in a high-tax state creates a filing obligation there. It doesn't work that way. State tax exposure follows domicile (for worldwide income) and, separately, where the work is physically performed (for state-source income in states that tax nonresidents on local earnings). Florida happens to tax nobody on either basis, so a Florida assignment is tax-neutral for someone whose real tax home is elsewhere. If you want the benefit of Florida's 0% rate, the assignment isn't what does it, changing your actual domicile is.

Two related but distinct concepts get conflated constantly in locum tax planning, and getting them straight matters:

• Tax home (federal, IRS travel-expense concept): generally the area of your main place of business, used to determine whether travel, lodging, and meal expenses on temporary assignments are deductible under IRC §162(a)(2).
• Domicile (state-law concept): your one true, permanent legal home, the place you intend to return to and remain indefinitely. Domicile determines which state has the right to tax your worldwide income and, at death, potentially assess estate or inheritance tax.

A Florida mailing address, whether a P.O. box, a mail-forwarding service, or a relative's guest room you've never slept in, satisfies neither concept. It doesn't establish a real tax home for travel-deduction purposes (there's no genuine home base with duplicate living expenses), and it certainly doesn't establish domicile for state tax purposes (there's no intent-to-remain evidence behind it). It's the single most common and most easily defeated argument state auditors see from physicians trying to claim Florida residency.

The fix is straightforward, if not always convenient: your Florida address has to be where you actually live a meaningful portion of the year, tied to the full documentation checklist in Section 1, not a workaround to avoid actually moving.

Illustrative example, not a specific client outcome. Dr. Reyes is a locum hospitalist who has been domiciled in New Jersey, earning $380,000 a year in 1099 locum income, and takes assignments across several states. New Jersey's top marginal individual rate on income in that bracket runs roughly in the high-single-digits to near-double-digit range depending on the year and exact income mix; for illustration, assume state tax has been costing Dr. Reyes approximately $25,000-$30,000 per year. Dr. Reyes decides to move domicile to Florida.

By the second full year, once New Jersey ties are fully severed and the day-count clearly favors Florida, Dr. Reyes is filing no New Jersey return at all and paying $0 in state income tax on locum earnings, a swing of roughly $25,000-$30,000 per year compared to staying a New Jersey domiciliary. The first transition year is messier, a part-year NJ return is still required, and New Jersey could still challenge the move if the facts are thin, which is exactly why the documentation steps above are done immediately, not gradually.