Guides · Market data

Highest-Paying States for Locum Physicians 2026

Published 5 August 202610 min read

Search for the highest-paying states for locum work and you will find lists built from advertised rates on unfilled job postings — a sample that is systematically optimistic, because the postings that stay up are the ones nobody wants. We are not going to publish that, because we cannot source it.

What we can do is hold the contract constant and vary only the tax code. That isolates one real, checkable variable: how much of the same money you keep in each of the 51 US jurisdictions. Here is the whole table.

The contract being modelled

An identical locum physician contract, run 51 times:

• $1,600 a day, five days a week, 42 working weeks — $336,000 of gross 1099 receipts.
• $24,000 of deductible business expenses: malpractice $9,000, CME $3,500, licensing and DEA $2,500, other business costs $9,000. Schedule C net profit $312,000.
• Single filer, standard deduction, no retirement contribution, no other income, no local tax.
• Self-employment tax of $32,027 and federal income tax of $66,868 — identical in every state.
• Section 199A deduction of zero everywhere: medicine is a specified service trade or business and taxable income is far above the 2026 phase-out ceiling.

Only the state line moves. Figures come from this site's own calculator using the 2026 state schedules in its open parameter file.

All 51, ranked by what you keep

What the table actually says

The full spread is $27,042 a year — $213,105 in the nine no-income-tax states against $186,063 in Oregon. On a $336,000 contract that is 8.0% of gross, or about $16 an hour.

Real, and smaller than the folklore. A few observations worth more than the ranking itself:

• The rate matters more than the state. A $100-a-day higher rate is worth $21,000 a year gross before tax — comparable to moving from Oregon to Texas, and far easier to negotiate than to relocate.
• The middle of the table is nearly flat. Positions 16 to 40 span about $6,000 a year. Choosing between Kentucky and Kansas on tax grounds is choosing between $120.74 and $117.48 an hour, which is noise next to whether the assignment is any good.
• Only the two ends are decisive. The nine zero-tax states, and then California, Hawaii, DC, Minnesota and Oregon at the bottom. Everything in between is a rounding error against contract quality.

Four things this table does not capture

1. You may not escape your home state

This is the most important caveat and it is routinely ignored. Self-employment income is sourced to where the work is performed, so working in Texas generally creates no Texas liability — but if you are a resident of California, California taxes your worldwide income. A California-resident locum working Texas assignments pays California tax on the lot. The zero-tax column only helps you if you are not a resident somewhere that taxes you anyway.

Conversely, a Texas resident working an assignment in Oregon owes Oregon a nonresident return on the Oregon-sourced income. Multi-state locums routinely file three or four returns, with a resident-state credit for tax paid elsewhere to avoid double taxation.

2. Some no-income-tax states tax your business anyway

This bites independent contractors specifically, and is why "no income tax" is not the whole answer:

• Washington imposes a Business & Occupation tax on gross receipts from services. A tax on revenue, not profit, with no deduction for expenses.
• Tennessee has no individual income tax but does not recognise S-corporation status and applies excise and franchise tax to entities.
• New Hampshire has no wage tax but imposes a Business Profits Tax and a Business Enterprise Tax above filing thresholds, which a busy locum can cross.
• Texas levies a franchise (margin) tax on entities above the no-tax-due threshold.
• Hawaii (General Excise Tax), New Mexico (Gross Receipts Tax) and DC (Unincorporated Business Franchise Tax) also reach independent contractors in ways this table does not model.

3. Local income taxes

Ohio's municipal income taxes, Pennsylvania's local Earned Income Tax, Kentucky's occupational licence taxes, Maryland's county tax, Indiana's county tax and Missouri's city earnings taxes all apply to net profits and are not in the table. Ohio at position 12 and Pennsylvania at 15 look considerably better here than they will on your actual return. Use the local tax field in the calculator for those states.

4. Cost of living, and everything else

The table measures tax, not value. A locum whose lodging and travel are covered by the agency is largely insulated from local cost of living, which flattens one of the usual arguments — but licensing time, credentialing burden, malpractice climate, call requirements and whether you want to spend three months there all matter more than $3,000 of state tax.

Sources and method