Whether you’re moving to a nearby city or across the country, relocating isn’t cheap. Moving expenses can easily rack up thousands of dollars, depending on where you’re going and how you’re getting there.<\/p>\n\n\n\n
Good news: If you’re moving for work, you may be able to write off some of the costs.<\/p>\n\n\n\n
Here’s how to see if you qualify for a moving expense deduction:<\/p>\n\n\n\n
Not all costs of moving are deductible, nor will every moving situation qualify for a tax deduction.<\/p>\n\n\n\n
To keep yourself out of legal hot water, put your unique situation to this three-part test:<\/p>\n\n\n\n
If you relocate for work, it should be close to the time when you start your new job.<\/p>\n\n\n\n
Eligible moving expenses you incur within 12 months of the first day of your new job will qualify for a deduction. After that, you forfeit any right to claim a moving expense deduction.<\/p>\n\n\n\n
Distance to work is the fourth biggest reason why people relocate<\/a>. But simply having a long commute to your new job isn’t enough to deduct your move from your taxes.<\/p>\n\n\n\n To qualify, your new job must add 50 miles one way to your commute if you were to remain in your current home.<\/p>\n\n\n\n For example, if you’re currently traveling 10 miles to work, your new job would need to be 60 miles or more away from your home.<\/p>\n\n\n\n If you had no job prior to your move, then your new job must be at least 50 miles from your current home to qualify for a deduction.<\/p>\n\n\n\n Once you move, you must commit to working full-time in your new area for at least 39 weeks of your first 12 months of employment.<\/p>\n\n\n\n This doesn’t mean you have to stay at your new job. You simply have to continue working in the general area where you relocated to.<\/p>\n\n\n\n If you’re self-employed, this rule doubles. You must work full-time for at least 78 weeks during your first 24 months in your new area.<\/p>\n\n\n\n To qualify for a moving expense deduction, you’ll need to meet all three of the above parts. However, there are a few exceptions<\/a> to this:<\/p>\n\n\n\n In relation to the time test, temporary absences still count as working full-time. These situations include strikes, illnesses, family deaths, layoffs, natural disasters, or similar circumstances.<\/p>\n\n\n\n Seasonal work is also an exception to the time test. You’re still considered a full-time worker during the off-season provided it’s less than six months.<\/p>\n\n\n\n Members of the armed services do not have to meet the distance test if the move is related to a station change.<\/p>\n\n\n\n Also, retirees may be able to write off relocation expenses, even though the move isn’t work-related.<\/p>\n\n\n\n If you qualify for the moving expense deduction, don’t start celebrating just yet. Not all of the expenses you incur are tax-deductible, which means you’ll have to carefully separate them.<\/p>\n\n\nTime at the New Job<\/h3>\n\n\n\n
Exceptions to the Three-Part Test<\/h3>\n\n\n\n
What Expenses Can I Write Off?<\/h2>\n\n\n\n