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Claiming the Moving Expenses Tax Deduction

By Edited May 11, 2016 0 0

Moving expenses can add up to quite a bit. If you moved because of your job, you may be able to get some of that money back by claiming the moving expense tax deduction.

You have to meet two tests before you can claim moving expenses on your taxes: The distance test and the time test.

Distance Test

Your new job must be more than fifty miles from your previous home than your old job was. For example, if you had a twenty mile commute to your previous job, your new job must be more than seventy miles away before you can deduct moving expenses.

Time Test

You need to work in the same area as your new job for a minimum of 39 weeks during the first year. This does not mean you have to have the same job. If you work for yourself, you need to work full-time for a minimum of 39 weeks during the first year and 78 weeks in the first 2 years. You don't have to meet the time test if you are in the armed forces, your job ends because of a death or disability or you worked outside of the United States and moved back into the country to retire. You are also exempt if you were laid off, as long as it was not due to misconduct on your part.

What if you moved near the end of the year and won't have worked long enough to qualify for the moving expenses deduction by the time you have to file taxes? Well, you can still deduct your moving expenses on that year's tax return as long as you fully expect you will meet the time test within the next year. If you haven't finished moving yet by April 15th, request an extension so you can include all of your moving expenses on the tax return. If you don't work the required amount of time, you will have to amend your tax return and remove the deductions.

Deductible Moving Expenses

Some of the moving expenses you can deduct on your taxes are:

  • Packing supplies
  • Moving company
  • Moving insurance
  • Gas for your car or a flat rate of 24 cents per mile
  • Hotels you stay at while traveling
  • Utility disconnect and connect fees
  • Tolls
  • Parking fees
  • Thirty days of storage

Some things you cannot deduct are:

  • Meals while traveling
  • Any expenses for sightseeing trips along the way
  • General maintenance or insurance on your car
  • Fees for selling or buying a home
  • Lost security deposits
  • Fees for breaking a lease
  • House hunting expenses

Claiming Moving Expenses on Your Taxes

Keep all of your receipts in an envelope or folder so you will have them handy when you do your taxes. Keep these receipts in case you are audited and have to back up your claim. Keep in mind that you can't claim any moving expenses on your taxes that your employer reimbursed you for.



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