Tax and Financial Considerations for 1099 CRNAs/Nurse Anesthesiologists

Taxes are complicated enough. When you’re practicing as a 1099 CRNA/nurse anesthesiologist, they can be even more complex. But 1099 work offers a range of tax advantages — if you know how to access them. That requires a deep understanding of tax laws and careful financial planning. Jeremy Stanley, founder and CEO of CRNA Tax Associates, has been providing advice and guidance to CRNAs/nurse anesthesiologists for over two decades. Here, he offers vital tax insights to guide you down the path to financial success. 

The Tax Cut’s and Jobs Act made significant changes

It’s been said the only certainties in life are death and taxes. You could add “changing tax rules” to make that phrase more accurate. For 1099 CRNAs/nurse anesthesiologists, Stanley has important updates about recent tax changes that affect independent workers.  

New standard deduction rates: Tied to the rise in inflation, the standard deduction has seen an increase. For single filers, it has risen from $14,600 to $15,000, and for married filing jointly, it has increased from $29,200 to $30,000 — about a 2.8% increase. “They do change these things. There is a little bit of rhyme or reason to the tax code,” Stanley said, hinting these figures could — and likely will — change in the near future. For that reason, 1099 CRNAs/nurse anesthesiologists should pay close attention to this aspect of taxes. 

Tax bracket changes: Like standard deductions, tax brackets are also adjusted annually to reflect inflation. It is essential for 1099 CRNAs/nurse anesthesiologists to understand which tax bracket they fall into, as this determines the tax rate applied to their income. The marginal tax rate is the percentage you pay in taxes on the next dollar you earn while effective tax rate is the average tax rate you pay in total to the federal government. Stanley explains how these relate to tax brackets and today’s changes: 

• Marginal tax rate: “Your marginal rate is if I earned one more dollar, what would the tax bracket be for me?” For example, if you earned $197,299, you are in the 24% tax bracket, but if your income increases to $197,300, you move into the 32% bracket.
• Effective tax rate: In addition, 1099 CRNAs/nurse anesthesiologists should be aware of their effective tax bracket. “For all the money you made, how much tax did you pay?” he said. “If you made $1 million dollars and you paid $200,000 in taxes, you’re in the 20% effective tax bracket.” 

Self-employment Taxes

One of the biggest benefits of 1099 work is the autonomy to control all aspects of your practice. Along with that, however, comes a range of financial responsibilities, like accounting for the self-employment tax that covers Social Security and Medicare. W-2 employees don’t pay the full amount themselves, as the employer covers half.  

Social Security and FICA (Federal Insurance Contributions Act): Unlike W-2 employees, 1099 workers are responsible for both the employee and employer portions of Social Security and Medicare taxes, totaling 12.4% for Social Security in 2025. This FICA rate changes based on inflation and overall wages. “The FICA wage base has been going up every year, and in fact it goes up more than inflation,” Stanley said. “It is based off inflation and wage growth trends.” “Strategies like forming an S corp can potentially help manage these taxes,” he said. More on that below. 

Medicare: This tax rate is 2.9% — 1.45% employee plus 1.45% employer — and it applies to all income without a wage base limit. 

Deductions and Expenses

Another benefit of 1099 work is the ability to take advantage of various deductions to reduce your taxable income.  

Section 179 and bonus depreciation: This allows CRNAs/nurse anesthesiologists operating as a business to deduct the cost of qualifying assets, such as automobiles, medical equipment, software, and more. It’s a deduction ideal for vehicles, with a caveat. “Remember that anytime you do this, the vehicle must be used over 50% of the time in business to qualify for this,” Stanley said. Bonus depreciation might be phased out in the coming years, so Stanley suggested 1099 workers keep their eye on this and act soon if they want to take advantage of it. 

Home office deduction: This deduction is an option for 1099 CRNAs/nurse anesthesiologists who work from home. Two methods are used to calculate this deduction: the simplified method and the actual expense method. 

• “The simplified method basically says however many square feet I’m using as a home office — if it’s 20-by-10, that’s 200 square feet. You multiply that by 5 to get a $1,000 deduction, reported on Schedule A, which is an itemization,” Stanley explained. 
• The actual expense method is more complicated: You must determine the percentage of your home used for business based on square footage and apply that percentage to actual home expenses, such as mortgage interest, rent, utilities, insurance, and repairs. For example, if your home office is 10% of your home’s square footage and your total mortgage interest for the year is $10,000, you could deduct $1,000 (10% of $10,000). “This requires meticulous, accurate recordkeeping,” Stanley said. 

Business expenses: 1099 CRNAs/nurse anesthesiologists can deduct ordinary and necessary expenses incurred in the running of their business. Again, Stanley said accurate recordkeeping is essential to substantiate these deductions. 

Retirement savings: Contributing to retirement savings is a powerful way to not only plan for your future but also maximize your tax savings. Stanley highlighted some important details for 1099 CRNAs/nurse anesthesiologists to remember about plans like SEP IRAs and solo 401(k)s. 

• Contributions for 401(k)s went up in 2025 to an employee limit of $23,500. Special catch-up provisions are available for those age 50 and older, and additional ones apply to individuals ages 60 to 63. “I know it makes it very complicated,” Stanley said. “But $70,000 is the maximum annual 401(k) limit for individuals under age 50 and $77,500 for individuals over age 50.” 
• The SEP contribution limit is $70,000, but no employee contributions are allowed — just an employer subjected to a 25% rate. “So in order to get $70,000 in your SEP, you’ve got to pay yourself a salary of $280,000-plus,” Stanley explained. “That could potentially cause more taxes, so you need to talk to an advisor.” 

Gift exclusion: In 2025, the gift exclusion (the amount of money you can gift someone without being taxed) increased to $19,000 per recipient. “You can give this amount of money to anybody you want to free of the gift tax,” Stanley said. 

Qualified Business Income (aka QBI)

Qualified Business Income (QBI), or Section 199A, can be a significant savings for 1099 CRNAs/nurse anesthesiologists. QBI is the net amount of income from your business, whether it’s an S corp or sole proprietorship. Stanley explains, ”QBI allows up to 20% of qualified income to be tax-free. To qualify, your business must be a pass-through entity, and the deduction is taken at the shareholder level, not the corporate level for S corps. Eligible entities include sole proprietorships, partnerships, S corps, LLCs, PLLCs, and LLCs/PLLCs taxed as S corps.” 

However, Stanley highlights a critical caveat. If you’re in a specified service, trade, or business (SSTB), which includes CRNAs/nurse anesthesiologists, QBI phases out based on income. For single filers, the phase-out range is $197,300 to $247,300, and for married filing jointly, it’s $394,600 to $494,000. 

Still, Stanley emphasizes the tax planning opportunities here, noting potential ways to lower income to qualify for this deduction. But he cautions you must strike a balance: lowering income too much can disqualify you from QBI while not lowering it enough results in missing out on the benefit. 

“There’s a lot of planning around this,” Stanley said. “But just be aware if you can get 20% of your income taxed at 0%, that’s a very, very big tax break.” 

Tax Planning and Compliance

Among the many tax considerations 1099 workers must consider — deadlines are incredibly important. 

Estimated taxes: 1099 CRNAs/nurse anesthesiologists must pay estimated taxes quarterly to avoid penalties. These payments cover income tax and self-employment tax liabilities. Quarterly estimated tax payments are due April 15, June 16, Sept. 15, and Jan. 15 each year. 

Filing deadlines: Deadlines for personal and business returns vary, as do their extensions, if requested. 

• S corporation and partnership returns are due March 17; individual returns are due April 15. Extension deadline is Sept. 17. 
• Personal returns are due April 15. Extension deadline is Oct. 15. 

State taxes: For 1099 CRNAs/nurse anesthesiologists working in multiple states, familiarize yourself with each state’s laws. You could owe income in each state in which you practice, Stanley said, especially in the absence of a reciprocal agreement between your home state and the state you’re working. Stanley suggests tracking time and income by state and filing tax returns in each relevant state. To complicate matters, if you operate an LLC or PLLC and work in a state other than your home state, you likely need to establish a foreign entity in that state to ensure your business is legally recognized. “This is a pretty complicated area,” Stanley said. “Make sure you understand the rules on this if you’re working in multiple states — and if you are, make sure that you’re doing things right.” 

Maximize Tax Planning and Savings with the 1099 CRNA Institute

Successfully operating as a 1099 CRNA/nurse anesthesiologist requires a strong grasp of tax laws and related financial planning and business operations. The AANA 1099 CRNA Institute is your comprehensive guide, offering a wealth of knowledge via webinars, educational materials, and access to expert advice.