Tax Write Offs For Moving Expenses

Relocating to start a new job can be a very stressful time. Fortunately, you may be eligible for some welcome relief in the form of a tax deduction for your moving expenses. There are three main “tests” the IRS uses to determine eligibility: the start of work test; the distance test; and the time test.

REQUIREMENTS TO CLAIM DEDUCTION

* Did you move less than a year before (or after) the day you began work?

* Is your new office at least 50 miles farther from your old home than your old office was? Also, “the distance from your new home to the new job location is not more than the distance from your former home to the new job location.”

* Did you work full-time for your new employer at least 39 weeks during the year after your move? If self-employed, did you also work 78 weeks or more during the two years post move? (There are exceptions for disability, involuntary separation, involuntary transfer, and death.)

DEDUCTIBLE EXPENSES

All reasonable costs of moving — for which you otherwise were not reimbursed — may be deducted. These include:

* transportation (gas) (see rates from JD Main)
* packing, crating, unpacking
* insurance / transit coverage
* shipping automobiles / boats
* transporting pets (cats, dogs, tropical fish, birds)
* utility connection/disconnection costs related to the move
* moving personal belongings from a second home / relative’s home
* lodging (but not meals) for household members during transit
* temporary storage

TYPE OF DEDUCTION

This deduction is “above-the-line” — taken before the adjusted gross income (AGI) is calculated. Such tax deductions are subtracted from gross income; the resulting number is the AGI. Above-the-line deductions stand whether or not itemizations are claimed. Above-the-line deductions are highly beneficial for taxpayers.

CLAIMING THE TAX DEDUCTION

Moving expenses should be enumerated on Tax Form 3903 (Moving Expenses) and deducted as an income adjustment on Tax Form 1040 (U.S. Individual Income Tax Return). Attach Form 3903 to the 1040 Form. See IRS Publication 521 (Moving Expenses) for details on nondeductible expenses, moving out of country, and special rules.

REMEMBER

* Hold on to all receipts related to the move.

* For those who are self-employed, married filing jointly, or armed forces member — special rules apply. (Members of the armed forces are usually exempt from the distance and time tests.)

* If a married couple moves, just one spouse need fulfill the 39-week full-time employment rule.

* The 39-week test will be waived if you are fired after moving.

via:http://www.hvmoving.com/tax-write-offs-for-moving-expenses/