Did You Know Moving Expenses Are Tax Deductible?

moving expensesThere’s no denying that moving expenses can be a source of stress. Plus, there’s all that packing, contacting utilities, buying or renting a new place to live and adapting to your new surroundings, job and friends. However, one bright spot to moving is that many of the expenses related to your move can be deducted on your federal tax return.

Moving expenses: what’s deductible

For moving expenses to be tax-deductible, the move needs to be work-related and your new job must be at least 50 miles further away from your home than you current office is. You also have to work at the new job at least 39 weeks during the first 12 months and moving expenses must be incurred within one year of starting your new job. The new job can be the result of your company transferring you to an office in another city or your taking a job that requires you to move to a different city. (Note: you need to have the job BEFORE you move. Moving in hopes of finding a job doesn’t count, according to the IRS.)

If you need the time and distance requirements, then make sure to save your receipts and make detailed notes about what you spend on the move. Below are just a few of the moving expenses you can deduct from your taxes.

  • The cost of packing and moving your possessions from your former home to your new home
  • Insurance for your possessions during the move
  • The cost of storing your possessions up to 30 days after your move
  • Utility connection and disconnection fees
  • Travel arrangements (flights, car rentals, trains) to get your family and your pets from the old house to the new house (one trip per person; you don’t have to travel together)
  • Some hotel and travel expenses related to the move (not meals)
  • Car shipping expenses
  • Car related moving expenses, such as tolls, gasoline, oil and parking

Moving expenses: what’s not deductible

In addition to moving expenses that are not job-related (such as you retired and want to live in Arizona or you prefer the scenery in Florida), the following expenses are not tax deductible:

  • Expenses that are reimbursed by your employer
  • Meals while you travel to your new home
  • Expenses related to buying and selling a home
  • Expenses incurred by breaking a lease
  • Real estate taxes
  • Security deposits

Other things to consider

For moving expense deductions to impact your tax return, you must itemize your deductions and file the long 1040 form (as well as the moving expense form 3903.) That means if your total deductions don’t exceed the standard deduction, you won’t realize a net tax advantage. Most homeowners far exceed the standard deduction because of interest and other home-related deductions. Those who rent may not realize as much of a tax savings.

Members of the U.S. armed forces are not required to meet the IRS time and distance requirements if they are moving on orders or because of a permanent change of station.

Moving with Red Ball

To learn more about how to make your move easier and less stressful, contact Red Ball for a free quote. We have more than 90 years experience in helping people like you move across the state or across the country. We operate in all 50 states and are adept at offering quality service at an affordable price.