Tax deductions for moving
As 2007 wraps up, many of us are getting our records in order in preparation for tax day, April 15, 2008. If you are one of those people, and you have made a move this year, you are probably wondering if there are any allowable tax deductions. So….here is the answer.
The IRS does allow tax deductions for moves which were made to accommodate a job in a new location. There are, however, two tests which must be met in order to qualify for deductions.
Test 1: Distance TestTo qualify for a deduction, your new principal workplace must be at least 50 miles farther from your previous home than your old workplace was from that same home. In other words, if the commute to your old workplace was 3 miles, your commute from your previous home to your new workplace must be at least 53 miles. If you did not have a job before moving, then your new job must be at least 50 miles from the previous home.
Test 2: Time TestIn addition, you must work full time in the general area of your new workplace for at least 39 weeks during the 12 months right after you move. There are exceptions to the time test and other rules apply if you are self-employed. Check with your tax advisor or check out Form 3903 on the IRS website for details. If you have passed both the distance and time tests you may be able to deduct:
Costs for packing, crating and movement of your household goods
Up to 30 days of storage and insurance for household goods
Transportation and lodging expenses (not meals)You may not deduct expenses that have already been reimbursed by your employer and you may not deduct sightseeing or house hunting trips.
The IRS does allow tax deductions for moves which were made to accommodate a job in a new location. There are, however, two tests which must be met in order to qualify for deductions.
Test 1: Distance TestTo qualify for a deduction, your new principal workplace must be at least 50 miles farther from your previous home than your old workplace was from that same home. In other words, if the commute to your old workplace was 3 miles, your commute from your previous home to your new workplace must be at least 53 miles. If you did not have a job before moving, then your new job must be at least 50 miles from the previous home.
Test 2: Time TestIn addition, you must work full time in the general area of your new workplace for at least 39 weeks during the 12 months right after you move. There are exceptions to the time test and other rules apply if you are self-employed. Check with your tax advisor or check out Form 3903 on the IRS website for details. If you have passed both the distance and time tests you may be able to deduct:
Costs for packing, crating and movement of your household goods
Up to 30 days of storage and insurance for household goods
Transportation and lodging expenses (not meals)You may not deduct expenses that have already been reimbursed by your employer and you may not deduct sightseeing or house hunting trips.
posted by Ken Calhoon at 7:42 AM
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