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Deducting Moving Expenses on your Taxes

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Home > Moving Guides > General Moving Tips > Deducting Moving Expenses on your Taxes


Can I Deduct my Moving Expenses on my Taxes ?

 

Did you know that you may actually be able to deduct some or all of your moving expenses on your taxes? While not everyone is able to do this, if you are able to pass the time and distance test that the IRS imposes on such matters then you may well be able to write some of the costs of your move off on your next tax return.

 

 

Essentially, according to the IRS, you may be able to deduct your moving expenses if you meet all of the following requirements:

• Your move is related to your work start date
• You pass the time test
• You pass the distance test

What are Time and Distance Tests?

In order to write off costs of your move on your tax return you must be able to demonstrate that the move was related to your work in terms of time and place. In other words, you must have moved within one year from the date you began work at a new location. You do not need to have started to work prior to moving, but you must go to work.

 

 

In terms of place, the distance from your new home to your new workplace must be less than the distance from your old workplace to your old house. Usually, the only way around this is if living in a new area is a requirement for the new job or if you can demonstrate that it will cost less to commute or you will spend less time commuting.

 

 

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Deductible Expenses

The IRS will only allow you to deduct those expenses that are deemed to be reasonable. Travel costs must be demonstrated to be the most direct and shortest route from your old residence to your new residence. If you decide to travel by car then you have the option of deducting either the standard mileage rate or the actual expenses. Tolls and fees as well as gas and oil can be deduced, but you will not be able to deduct insurance, depreciation, general maintenance or general repairs.

 

You can also deduct lodging costs for yourself as well as members of your household during travel time. If all of your belongings have been moved out of your old home and you could not stay there, you can also deduct lodging expenses for one day after the move-out date.

 

 

Other costs that you may be able to deduct include:

• Costs for disconnecting or connecting utilities
• Costs for packing as well as crating and transporting your personal effects and household goods
• Shipping costs for shipping pets and/or vehicles to your new home
• Storage and insurance expenses for your belongings for up to 30 days after you have moved your belongings out of your old home and prior to having them delivered to your new home.

 

If you have any questions regarding deductible moving expenses, be sure to check the IRS website - Topic 455 - Moving Expenses use the IRS Moving Expenses Calculator or consult your tax advisor.




 

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