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Quick Tax Tips For The Tax Season (Tip #11)

12:00 AM Jamaal Solomon 0 Comments Category :



DEDUCTING MOVING EXPENSES


I have an confession, when I was young and single, I dreamed of moving Down South. For some odd reason I wanted to move to North Carolina. However, I'm a punk and stayed in New York. Good thing I was a punk because I met my wife in New York. Now, we have two beautiful children. I wonder if I knew that I may be able to deduct some moving expense, would I have made the move? Probably not but lucky for you today's post is about moving deducting moving expenses. Below is straight from the IRS website (www.irs.gov).

Topic 455 - Moving Expenses


If you moved due to a change in your job or business location, or because you started a new job or business, you may be able to deduct your reasonable moving expenses but not any expenses for meals. You can deduct your moving expenses if you meet all three of the following requirements:

Your move closely relates to the start of work
You meet the distance test
You meet the time test

Move Related to Start of Work - Your move must closely relate both in time and in place to the start of work at your new location. You can consider moving expenses incurred within one year from the date you first reported to work at the new location as closely related in time to the start of work. A move generally relates closely in place if the distance from your new home to the new job location isn't more than the distance from your former home to the new job location. For exceptions to these requirements, see Publication 521, Moving Expenses.

The distance test - Your new workplace must be at least 50 miles farther from your old home than your old job location was from your old home. If you had no previous workplace, your new job location must be at least 50 miles from your old home.

The time test - If you're an employee, you must work full-time for at least 39 weeks during the first 12 months immediately following your arrival in the general area of your new job location. If you're 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 general area of your new work location. There are exceptions to the time test in case of death, disability, and involuntary separation, among other things. See Publication 521 for these exceptions.

Members of the Armed Forces
If you're a member of the Armed Forces and your move was due to a military order and permanent change of station, you don't have to satisfy the distance or time tests.

Reporting Moving Expenses
Figure moving expenses on Form 3903, Moving Expenses, and deduct as an adjustment to income on Form 1040, U.S. Individual Income Tax Return. You can't deduct any moving expenses covered by reimbursements from your employer that are excluded from your income.

SOURCE: https://www.irs.gov/taxtopics/tc455.html

Remember that these posts are just quick reminders of possible tax deductions. I recommended consulting with a tax professional like myself (shameless plug) to dig in deeper in these tax deductions.

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