Many people pick up and move each month, often to start a new job. Although moving can be very expensive, remember that Uncle Sam may be able to\u00a0help pay the costs through tax deductions if you meet a few tests.<\/p>\n
1. Did you have out of pocket costs<\/strong>? If your employer paid all the relocation costs and didn\u2019t include it in your income, you came off scott-free and you don\u2019t have any expenses to deduct on your tax return.<\/p>\n Deductible out-of-pocket costs include the expenses of packing and moving your belongings to your new home, temporary storage for up to 30 days, insuring your goods, utility connection costs (but not car registration), shipping pets, and the expenses of traveling to your new home, and lodging expenses on the trip and when you first arrive at your new location.<\/p>\n But surprisingly, meals aren\u2019t included, so if you wine and dine along the way, don\u2019t expect Uncle Sam to foot the bill. Helpful hint: You don\u2019t have to itemize your deductions to claim moving expenses, and no limitations, income thresholds, phase-ins or phase-outs will reduce what you are allowed to claim.<\/p>\n 2. Did you move because of a job<\/strong>? If so, your new job must be at least 50 miles farther from your old house than the distance between your old house and your old job. Got that? Let me explain with an example. Let\u2019s say your old commute from home to the office was 10 miles. Now you have a new job in a neighboring town that is 65 miles away from your old house. You pass the test, because the distance from your new job to your old house (65 miles) exceeds your prior commuting distance (10 miles) by at least 50 miles. Helpful hint: It doesn\u2019t matter if the job is your first job, a new job, or the same job in a different location.<\/p>\n 3. Did you work full time in the new location<\/strong>? During the first year after your move, you have to work full-time for at least 39 weeks. That means that you can move to a new location and look for work, but you\u2019ll need to land your new job and start work within three months. (If you are self-employed, the period is two years, during which you have to work at least 78 weeks.) Helpful hint: The worked weeks don’t have to be consecutive or even with the same employer.<\/p>\n Those three questions\u00a0will cover most work-related\u00a0moving situations, however here are a few special circumstances that have can result in\u00a0cost deductions\u00a0as well.<\/p>\n Your move is delayed<\/strong>. Let\u2019s say that you are in a hurry to begin your new job, so you travel to your new location and stay in temporary housing until you can afford the time to make the move. Or your spouse may be finishing up her employment or the kids are finishing school in the old location. You must move within 12 months of starting your new job, or no deduction.<\/p>\n Your spouse was employed in old location but not in the new location<\/strong>. If your spouse has trouble finding work in the new location, or decides to stay home with the kids or go back to school, no problem. Only one spouse needs to meet the employment rules. But you and your spouse can\u2019t alternate working and still get the deduction, since one of you must work 39 weeks in the first year \u2013 you can\u2019t combine both your employment histories to satisfy that requirement.<\/p>\n