Get a Tax Deduction for Moving Expenses
Did you relocate for a new job? Or have a move coming up? Money Girl explains 5 ways to get tax deductions for certain relocation expenses.
Did you relocate for a new job—or have a move coming up? Don’t forget that that you can claim a tax deduction for certain moving expenses. Here are 5 tips to trim your taxes:
You must pass a distance test. Your new job must be at least 50 miles farther away from your previous home for moving expenses to be deductible.
You must pass a time test. You can generally consider moving expenses incurred within one year from the date you start working at a new location as deductible. Also, you have to work full time for at least 39 weeks during the first 12 months on the job.
You can deduct moving expenses. The costs of packing, crating, storing (during transit only), insuring, and transporting your household goods and personal property—plus, the costs of connecting or disconnecting utilities, are deductible.
You can deduct travel expenses. During your trip to the new location you can deduct airfare, vehicle mileage, parking fees, tolls, and lodging (but not meals).
You can’t deduct every expense. The costs of buying or selling a home, entering into or breaking a lease, security deposits, car tags, and drivers license renewal, are examples of nondeductible expenses.
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