Can I Deduct My Moving Expenses?

For any of you who have recently moved, or are planning to move, you know how much of a headache it can be. From box searching to bubble wrap, from turning off utilities in one location to turning them on somewhere else, to changing your addresses on all your bills; the inventory on the to-do list is nonstop.

When it comes tax time however, be sure you take advantage of deductions that you may be eligible for with regards to your move.

Can you deduct your expenses? If so, which ones? How do you report your moving expenses to the IRS?

Qualifying for the deduction

In order to deduct moving expenses, your relocation must meet the following three tests:

1. Your move must be due to, or closely related to, the start of work.

2. You must meet the distance test.

3. You must meet the time test.

Moving expenses generally can be deducted if they are incurred within one year from the date you first started your new employment. If more than a year has passed, you must establish that circumstances existed that prevented you from moving within the previous 12 months.

The distance test requires you to do some math. According to IRS rules, the distance test is met if your new job location is at least 50 miles farther from your former home than your old main job location was from your former home.

For example, if you previously commuted 8 miles to work every day from your old home to your old job, your new job location has to be at least 58 miles away from that same former home.

The time test must also be met. This test has different qualifiers, depending on if you are an employee or self-employed.
If you are an employee, you must work full time for at least 39 weeks during the first 12 months after you arrive in your new home. The 39 weeks do not have to be for the same employer, nor do they have to be consecutive. If you are self-employed, you also must work for the same 39-week timeframe during the first 12 months, and, you must work for at least 78 weeks during the first two years.


If you file jointly, and both you and your spouse work full-time or are self-employed, then either of you can satisfy this time test. You cannot, however, add your employment time together for the purpose.


Expenses you can and cannot deduct
Most reasonable expenses associated with your move can be deducted. This includes vehicle expenses. If you are using your own vehicle(s) to haul your belongings, you can deduct all actual expenses incurred in the move (gas, oil, repairs, tolls, etc.), or you can choose a standard deduction of 16 ½ cents on every mile.

Costs involved in packing, crating and shipping are also fully deductible. Costs incurred with having your vehicle shipped or transported, as well as the cost to transport pets, is also an allowable expenditure.

If you have rented a transport in order to move, such as a U-Haul, then this too is deductible. As is the cost you must pay for gas, tolls and any parking fees.

If you are moving your belongings into storage, deduct the monthly fee for the storage units.

Expenses you cannot deduct include the purchase price of your new home, selling costs of your old home, costs incurred with registering your vehicle or renewing your license plates in the new location, house-hunting expenses, real estate taxes, security deposits or return trips to your old home. All costs incurred with furnishing your new home are also non-deductible.

Form 3903
Use Form 3903 to claim your deductions. Attach this form to your Form 1040. The form is relatively simple. It asks you to add up all costs associated with your move, and then to subtract out any expenses that may have been reimbursed by your new employer.

For more information, see IRS Publication 521, Moving Expenses.

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