Write Off Your Moving Expenses
Awesome news, you may be able to take your moving expenses as a tax deduction!
While government regulations are harder now than they used to be, it is still possible to catch a break if you meet the following criteria:
Your new job or your job transfer is at least 50 miles further from your home than the old house was.
If you didn't have a previous job, the new one has to be at least 50 miles from your old house.
Your move must make your commute shorter than it was before the move.
If you are in the military and had a change of station.
If you’re working full-time (over the next 12 months) even if you are self-employed.
If you incur expenses within 1 year from the day you reported to work at your new job.
The required length of time is waived in cases of a new job for members of the armed forces, those transferred by an employer, those who lost a job through no fault of their own, and those returning to the United States from abroad when they retire (or their survivors).
Instead of being included in itemized deductions, expenses are deducted directly from your adjusted gross income! You may then take a standard deduction if it’s an advantage to you.
Qualified deductions include:
Packing and transporting household items
Mileage for using your own car (or gas and oil expenses)
Tolls and parking fees on the trip
Up to 30 days' storage of household items
Disconnecting and connecting utilities
Transportation and lodging for yourself and the members of your household while traveling to the new house
No longer allowable:
$3,000 more for up to 30 days’ temporary living expenses, house hunting trips and costs of selling an old home and buying a new one.
*Unless you deferred the expenses, expenses are deductible in the year you paid them.
If your employer pays for your move, those payments of qualified moving expenses are excluded from your taxable income and need to be noted with a code P in box 12 of your W-2.
Something to be aware of, some employers pay the cost of items no longer allowed (temporary living expenses, house hunting trips, costs of selling a house), so those amounts need to be included in your taxable income. Your employer should add them to Box 1 of your W-2. Its important to know that if your employer is ignorant of the current standards, you are responsible to include the payments in your taxable income and pay taxes on them accordingly.
In order to write off your relocation costs, you have to use the long Form 1040 to claim them. You don’t need to itemize any other deductions. The costs are detailed on Form 3903 and the total transferred to line 27 of your return. You don’t need to complete Schedule A, meet any percentage-of-income thresholds, or deduction phase-outs.