Search:

Moving For Your Job? You Could Claim a Tax Deduction

Moving is not something I nor most others even remotely enjoy. If you want to work, it is a fact of life these days. Fortunately, you can make that move and claim tax deductions if you meet a couple simple tests.

Death, taxes and moving. With me, it is a close call on which one I dislike more! Okay, death is definitely the winner, but moving is a close second. Unfortunately, we are all moving more and more due to a changing employment environment.

The simple fact is the old world days of working for one company in one town for thirty or forty years are long gone. Everyone changes jobs these days. In many cases, the optimal job you are looking for is often in another location.

The federal government always seems to be about 20 years behind the times, but not in this case. It has acknowledge the changes in society and created tax deductions for people who move for employment purposes.

So, can you just claim deductions for your moving expenses? Of course not. We are talking about taxes, which means you have to pass tests. The first is you new job must be 50 miles further from your home than your last job. Huh?

Let's look at an example. Assume I work a my horrible job which is 9 miles from my home. I take my new wonderful job which is located 109 miles from my home and I have to move. Since the difference is 100 miles, I can claim moving deductions.

There is a second test as well. The time test. The time test requires you to work for at least 39 weeks during the 12 months immediately after your move. This more or less means 10 months out of the 12.

If you are self-employed, there is another time test. You have to meet the 39 week test above. You also must work a total of 78 weeks in the first 24 months after moving. You can take these deductions ahead of time if you expect to complete them.

There will be a natural temptation to claim moving deductions, particularly if you are close to passing the tests. Don't. The IRS closely watches how taxpayers claim new tax deductions, so you don't want to get audited.

Okay, you passed the tests. What can you claim? Well, your reasonable moving expenses including mileage, truck rentals, and lodging. Oddly, you cannot claim meals while driving from your old home to the new one.