Moving Expenses Related to a New Job May Be Tax
Deductable
August 18, 2008
Did you recently move to another city for a new job or
because your old job is now at a new location? A tax break
may be coming your way.
How far you moved and the amount of time you spend on the
job will have a major impact on whether you qualify for the
tax break. Moves that are only short hops and jobs that are
short-term or part-time generally do not qualify. However,
if you can satisfy the distance and time tests then
job-related moving expenses that you incur may be tax
deductible.
You will meet the distance test if your new workplace is at
least 50 miles further from your former home than your
previous workplace was from that home. For example, if
your old job was 5 miles from your former home, your new job
must be at least 55 miles from that home.
The time test requires you work full-time for at least 39
weeks during the 12 months immediately after your move. If
you are self-employed, the time test requires you to work
full-time for at least 39 weeks during the first 12 months
and for a total of at least 78 weeks during the first 24
months after your move. You can deduct your moving
expenses on your tax return even though you have not met the
time test by the date your return is due if you expect to
meet the 39-week or the 78-week test as required.
Members of the armed forces do not have to meet these tests
if the move was due to a permanent change of station.
Reasonable moving expenses are deductible and include the
costs of moving your household goods and personal effects to
your new home. You can also deduct the expenses of traveling
to your new home, including lodging costs.
Meals eaten while in transit between your old and new homes
are not deductible as moving expenses. No part of the
purchase price of your new home may be deducted as a moving
expense. You cannot claim a moving expense deduction
for expenses covered by reimbursements excluded from income.
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