How to Read a Travel Therapy Pay Package
A travel pay package is a small financial product dressed up as a text message. The number a recruiter leads with — "$2,670 a week" — is the least informative figure in the whole arrangement. What matters is how that total is built, because two packages with the same headline can differ by nearly two thousand dollars over one contract, and one of them can carry a tax exposure the other does not.
The anatomy of a package
Ask for the offer as line items, in writing, every time. A complete package has most of these:
| Line item | Taxable? | What to check |
|---|---|---|
| Taxable hourly rate | Yes | The only number your overtime, unemployment benefit, Social Security record and mortgage application are built on. |
| Housing stipend (weekly) | No, with a tax home | Compare against the local GSA lodging rate for your assignment months. |
| Meals & incidentals stipend (weekly) | No, with a tax home | Compare against the GSA M&IE tier for the city. |
| Travel reimbursement | No, with a tax home | Usually split half on arrival, half on completion. Ask when it is paid and whether it is clawed back. |
| Licence / certification reimbursement | Usually not | Cap, documentation required, and whether it survives an early termination. |
| Completion bonus | Yes | Confirm the exact conditions. "Completing the contract" can mean not missing a single shift. |
| Guaranteed hours | — | The single most important non-dollar term. See below. |
| Overtime rate | Yes | Almost always 1.5× the taxable rate, not the blended rate. |
| Orientation pay | Yes | Some agencies pay orientation at a reduced rate, or not at all. |
| Call / holiday / weekend differentials | Yes | Rare in outpatient, common in acute care and SNF coverage. |
| Benefits | — | Day-one health cover or a waiting period; 401(k) match; whether cover lapses between contracts. |
Why the blended rate misleads
The blended rate is the whole weekly package divided by hours. It is the number agencies advertise because it is large and because it makes structurally different offers look identical. Consider two real-shaped offers for the same 13-week outpatient PT assignment, both quoting essentially the same blended rate:
| Offer A | Offer B | |
|---|---|---|
| Taxable hourly rate | $38.00 | $22.00 |
| Housing stipend / week | $850 | $1,300 |
| M&IE stipend / week | $301 | $490 |
| Gross per 40-hour week | $2,671 | $2,670 |
| Blended rate | $66.78 | $66.75 |
| Estimated weekly take-home (Texas, single) | $2,404 | $2,542 |
| Estimated net for the 13 weeks | $31,256 | $33,052 |
| Overtime rate | $57.00/hr | $33.00/hr |
| Share of package untaxed | 43% | 67% |
Take-home figures from the TravelPayLab calculator using 2026 federal brackets, FICA and Texas state tax, single filer, 48 working weeks a year, no pre-tax deductions.
Offer B pays about $1,796 more over the contract. It is also the offer that would make a travel tax specialist wince: two-thirds of the package is untaxed and the taxable rate is $22 an hour for a licensed physical therapist, against a national median of $101,020 a year for the profession — roughly $48 an hour for full-time work — in the BLS May 2024 survey. That is the pattern Revenue Ruling 2012-25 describes as wage recharacterisation.
The punchline
Run both offers again assuming your tax home does not hold up — which is the scenario the whole structure is betting against — and they net exactly the same: about $2,060 a week. Offer B's entire $1,796 advantage exists only while the tax position survives. Offer A's does not depend on it. That asymmetry is what you are actually choosing between, and no recruiter will frame it that way.
Guaranteed hours: the clause that decides your worst week
A stipend is quoted weekly but is usually paid against hours worked. If the facility sends you home for low census, a package without genuine guaranteed hours can shed several hundred dollars in a single week — and the housing stipend does not care that your rent is still due.
Ask, in this order: Are hours guaranteed? Guaranteed by the agency or only by the facility? What happens to the housing and M&IE stipends in a week where I work 24 hours? Can the facility "call off" a shift and does that count against the guarantee? Is there a cap on how many hours can be missed before the guarantee lapses? Get the answers in the contract, not in a text.
Four questions that expose a weak offer
- "What is the taxable hourly rate?" If the recruiter resists breaking it out, that is the answer.
- "What is the GSA rate for this city, and how does the stipend compare?" You already know, because you looked it up. You are checking whether they did.
- "What is my overtime rate in dollars?" Multiply the taxable rate by 1.5. On stipend-heavy packages this number is often startling.
- "What is the cancellation policy, on both sides?" Ask specifically what happens if the facility cancels before your start date, after you have already broken your lease at home.
A word on bill rates
The facility pays the agency a bill rate; the agency keeps a margin and passes the rest to you as the package. Margins are not usually disclosed and vary widely between agencies, contract types and how the job was sourced — a vendor-managed contract passing through an intermediary supports a smaller take-home than a direct one at the same bill rate. You will rarely learn the number, but you can infer pressure: if two agencies are recruiting for the same posting and one offers materially more, the bill rate is the same and the margins are not.
The practical takeaway is simply that a package is negotiable more often than travellers assume, and the taxable rate is the piece agencies are most willing to move once you ask for it specifically.
Before you say yes
- You have the offer in writing, as line items, including guaranteed hours and the cancellation policy.
- You have checked the stipends against the GSA rate for that city and those months.
- You know your overtime rate in dollars.
- You have run the package through a take-home calculator for the assignment state — not just compared blended rates.
- You know what the package is worth if the stipends turn out to be taxable, and you are comfortable with that number.
- You have confirmed when health cover starts and whether it lapses between contracts.
Sources
- US Bureau of Labor Statistics, Occupational Outlook Handbook: Physical Therapists — median annual wage $101,020, May 2024.
- Internal Revenue Service, Revenue Ruling 2012-25 — wage recharacterisation.
- Internal Revenue Service, Revenue Procedure 2019-48 — per diem allowances under accountable plans.
- General Services Administration, FY2026 per diem rates.
- Internal Revenue Service, Revenue Procedure 2025-32 — 2026 federal brackets and standard deduction used in the worked example.