Tax Deductible Moving
If you moved to start a new job or business you may be able to deduct the cost of your moving expenses from your income.
Qualifying expenses include costs for packing and shipping your household goods and personal property, and costs for travel and lodging. Meals are not deductible as a moving expense.
You need to meet some conditions in order to qualify for moving taxes deduction for your recent relocation. Your move has to be work related, you have to meet the distance and time test.
The “distance” test could be bit confusing, because it actually has nothing to do with the location of the new home. Under the “distance test”, your new workplace must be at least 50 miles farther from your old home than your old job location was from your old home. If you had no previous workplace, your new job location must be at least 50 miles from your old home.
The “time” test – You must work full-time for at least 39 weeks during the 12 months following your move. If you are self-employed, you must work at least 78 weeks in the 24 months after you move.
If you are a member of the armed forces and your move was due to a military order and permanent change of station, you do not have to satisfy the “distance or time tests”.
You cannot deduct any moving expenses covered by reimbursements from your employer that are excluded from income.
Moving expenses you can deduct as an adjustment income on form 1040 and for this you will need form 3903. For more information you should check with your tax consultant and with IRS. There are changes happening each year so, you need to stay up to date and pay attention to any tax deduction requirements changes. You can do this on the IRS website, or again by checking with your accountant.
For more information on deductible and nondeductible moving expenses, please refer to IRS Publication 521, Moving Expenses.