In general, moving deductions are deductible if you meet certain qualifying tests. However, like other parts of the tax law, there are exceptions and special cases. The following is an abbreviated overview of the qualifications for domestic moves. Foreign and military moves require certain special qualifications. Click here for a worksheet to record your Moving Deductions.
1. Distance Test - A move will meet the distance test if the new main job location is at least 50 miles farther from your former home than your old main job location was from your former home. For example, if your old main job was 3 miles from your former home, your new main job must be at least 53 miles from that former home. The distance between a job location and your home is the shortest of the more commonly traveled routes between them. The distance test considers only the location of your former home. It does not take into account the location of your new home.
2. Related to Start of Work Test - Your move must be closely related, both in time and in place, to the start of work at your new job location. You can generally consider moving expenses incurred within one year from the date you first reported to work at the new location as closely related in time to the start of work. It is not necessary that you arrange to work before moving to a new location, as long as you actually do go to work.
3. Time Test - To deduct your moving expenses, you also must meet one of the following time tests.
Deductible Moving Expenses - You can deduct only those expenses that are reasonable for the circumstances of your move. For example, the cost of traveling from your former home to your new one should be by the shortest, most direct route available by conventional transportation. If during your trip to your new home, you make side trips for sightseeing, the additional expenses for your side trips are not deductible as moving expenses.
1) Household goods and personal effects - You can deduct the cost of packing, crating, and transporting your household goods and personal effects and those of the members of your household from your former home to your new home.
2) Storing and Insuring Household Goods - You can include the cost of storing and insuring household goods and personal effects within any period of 30 consecutive days after the day your things are moved from your former home and before they are delivered to your new home.
3) Connecting & Disconnecting Utilities - You can deduct any costs of connecting or disconnecting utilities required because you are moving your household goods, appliances, or personal effects. You can deduct the cost of shipping your car and your household pets to your new home.
4) Travel expenses - You can deduct the cost of transportation and lodging for yourself and members of your household while traveling from your former home to your new home. This includes expenses for the day you arrive. You can include any lodging expenses you had in the area of your former home within one day after you could not live in your former home because your furniture had been moved. You can deduct expenses for only one trip to your new home for yourself and members of your household. However, all of you do not have to travel together.
5) Meals - Meals are NOT a deductible moving expense!
6) Travel by car - If you use your car to take yourself, members of your household, or your personal effects to your new home, you can figure your expenses by deducting either:
Special Rules for Military Personnel
To deduct moving expenses, the military taxpayer usually must meet general time and distance tests. However, if the member of the Armed Forces is on active duty and moves because of a permanent change of station, they do not need to meet those tests.
Permanent change of station - A permanent change of station includes:
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