If you moved this summer for reasons related to your employment, the costs of the move might be eligible for tax deduction. This could be applicable if you were moving in order to perform the same job at a different location or if you are making a move for the sake of getting a new job. There are a number of tips that have been approved by the IRS and could be very helpful for you to deduct your moving costs on your next tax return.
There are a number of requirements that will need to be met for you to be able to deduct moving expenses. One of those requirements is that your relocation has to be closely related to the beginning of your new job. Moving expenses within 12 months of the date you begin a new job can be considered, although this requirement does have extra rules that should be researched beforehand. Another requirement is that you will have to meet the distance test. The new main location for your workplace should be a minimum of 50 miles further away from your former home than your previous place of employment.
You also need to be able to meet the time test. Once you have made the move, you need to have worked at your new location full-time for a minimum of 39 weeks over the course of the first year. This requirement also needs to have been met by people who are self-employed, who also have to work full-time for a minimum of 78 weeks in the first two years of their arrival in the area of their new employment location. Your allowable moving expenses can still be deducted if your income tax return is due prior to you having been able to satisfy this requirement, provided that you expect to be able to meet the time test. Transportation and lodging expenses for you and the other members of your family incurred while moving from your former home to your new location can also be deducted, although the cost of meals cannot.
When it comes to household goods, the cost of crating, packing and relocating your personal property and household goods can be deducted, and you might even be able to deduct the cost of having these items stored and “insured” (valuation coverage) while they are in transit. The costs associated with the disconnection and connection of utilities can also be deducted, but you cannot deduct anything that relates to the actual cost of your new home, the cost of selling your old home, or the cost of breaking or entering into a lease. Should you be reimbursed for the cost of your move by your employer and you also took a tax deduction, you may have to include this reimbursement as a form of income on your next tax return. Finally, make sure that you update the IRS with your new address.
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