Tax Deductible Moving Expenses

Tax Deductible Moving Expenses

If you moved in 2010, you might be able to claim some of your moving expenses on your taxes. 

According to Topic 455 at IRS.gov, these "reasonable" moving expenses may be tax deductible if your move was the result of a job change or business location change or because you started work or a new business in a new location.  In order to qualify, your move normally has to pass these two tests (there are exceptions in the case of death, disability, involuntary separation, military etc.):

  • The Distance Test. Your new place of employment must be at least 50 miles further from your old home than your previous job location was from your old home.  If you were not previously employed, your new job must be located at least 50 miles from your old home.
  • The Time Test.  If you are an employee, you must work full-time for at least 39 weeks during the first 12 months of arriving in the area of your new job location. If you are self-employed, you must 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 immediately following your arrival in the area of your new job location.

Things to note about tax deductible moving expenses:

  • Form 3903, Moving Expenses, is the form used to claim the moving expenses deduction.
  • The standard mileage rate for using your personal vehicle to move to your new home is 16.5 cents per mile for 2010.
  • Keep in mind that you cannot deduct moving expenses that are covered by reimbursements from your employer that are excluded from income.
  • You are responsible for saving all receipts, bills, credit card statements, cancelled checks, mileage logs and W-2 Forms and statements of reimbursements from your employer.
  • The "reasonable" moving expenses you can expect to be able to deduct are:  The cost to move your household goods and personal effects, traveling to your new home (includes lodging, but not meals), fuel, parking fees and tolls.
  • You must choose the most direct route to your new home— if you turn your trip into a vacation and do sight-seeing along the way, you can't expect those costs to be deductible.
  • You may be able to deduct storage charges within 30 consecutive days after the day your household goods are moved away from your previous home and before they are delivered to your new home.

You cannot deduct the following moving expenses:

  • Car tags
  • Driver's license
  • Expenses of breaking a lease
  • Expenses of buying or selling a home
  • Improvements to sell your home
  • Loss on the sale of your home
  • Loses for early cancellation of memberships
  • Real estate taxes
  • Return trips to your previous residence
  • Security deposits
  • Storage charges except those incurred in transit

While we know a lot about moving, we don't claim to be tax experts. That being said, if you have more questions about your tax deductible moving expenses, we recommend that you speak with your tax professional or checkout the IRS website at http://www.irs.gov/publications/p521/ar02.html#en_US_2010_publink1000203497. 

And, if you need a copy of your MoveBuilder receipt for moving expenses incurred in 2010, contact your MoveBuilder Move Manager at 800-940-9155.