Save Money on Moving with Tax Deductions

Moving can be very expensive, but thankfully the IRS wants to help you out with some very valuable tax deductions for moving expenses. In order to  be eligible for these savings, however, your domestic relocation must be related to your employment, you must move a certain distance away from your old home, and you must stay at your new job for a certain amount of time. If you fit within these criteria, then you can take advantage of the tax savings offered by the IRS.

The distance test for determining eligibility is slightly confusing, so here is a breakdown. Your new place of employment must be 50 miles farther from your old home than your old job location was from your old home. For example, if your old job is 20 miles away from your old home, your new job must be at least 70 miles away in order for you to qualify for tax deductions if you relocate. A similar eligibility test is given for time. First, you must start a new job within 12 months after your domestic relocation. The second test is that you must maintain full time employment for at least 39 weeks within the first 12 months after your move.

Taking advantage of deductions will require that you keep all applicable receipts related to your relocation. The costs related to deductions are costs spent moving household goods (with professional movers or self-service),  storage costs, insurance fees, utility connections and disconnections, auto transport costs and certain travel and lodging expenses associated with the relocation. A full list of potential deductions is on IRS Publication 521.

Tags: , ,

Comments are closed.