Anaya Nolan
Moving house can be an expensive and stressful experience, and it can be difficult to know what you can and can't claim on your taxes. In general, most taxpayers cannot deduct moving expenses for tax years 2018-2025. However, there are some exceptions to this rule, such as for active-duty military members and their families, and those who moved for work before 2018. To qualify for tax deductions, your move must be considered work-related, and you must pass the 50-mile test, which means your new job must be at least 50 miles further from your old home than your previous job. If you are an active-duty military member, you can claim moving deductions against your taxable income and include them on Form 3903 as an attachment to your Form 1040.
| Characteristics | Values |
|---|---|
| Tax years | 2018-2025 |
| Who can claim moving expenses? | Active-duty military members, their spouses and dependents |
| Who cannot claim moving expenses? | Taxpayers who are not active-duty military members |
| Criteria for claiming moving expenses | Moving expenses must be reasonable and necessary, and the move must be work-related |
| Work-related requirement | Distance between new primary job and former home must be at least 50 miles greater than the distance from former home to old job |
| Time requirement | Start new job and work full-time for at least 39 weeks within the first 12 months after the move |
| Distance requirement | New workplace must be at least 50 miles farther from the old home than the former office or place of employment |
| Standard mileage rate for 2022 | 18 cents per mile for the first half of the year, 22 cents per mile for the second half |
| Standard mileage rate for 2024 | 21 cents per mile |
| Deductible expenses | Storage and shipping costs, travel, gas and lodging costs |
| Non-deductible expenses | Meals, moving furniture or other goods bought on the way from the old home to the new home |
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What You'll Learn
Moving expenses for active-duty military members
If you are an active-duty military member, you may be able to claim moving deductions against your taxable income. This applies to the tax years 2018-2025 and only if your move was due to a military order and permanent change of station. A permanent change of station includes a move from your home to your first post of active duty, a move from one permanent post of duty to another, and a move from your last post of duty to your home or to a nearer point in the United States.
You can deduct your out-of-pocket moving expenses if they exceed the amount that you were reimbursed. However, you cannot deduct expenses that were reimbursed or paid for directly by the government. Deductible moving expenses are reported on IRS Form 3903, and any deduction on that form is reported on your regular federal income tax return.
To be considered a reasonable travel expense, the route you take must be the shortest and most direct one available from your previous home to your new one. Reasonable moving expenses may include the cost of lodging at a hotel on the way to your new home, but you cannot deduct expenses for meals.
It's important to note that tax laws frequently change, so be sure to consult a tax professional or refer to the IRS website for the most up-to-date information.
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Deductions for travel costs
The Tax Cuts and Jobs Act of 2017 eliminated the deduction for moving expenses for most taxpayers between 2018 and 2025. However, certain members of the Armed Forces and their families are exempt from this rule. Military personnel can claim moving deductions against their taxable income and include them on Form 3903 as an attachment to their Form 1040. An active-duty military member's move must result from a military order and permanent change of station to qualify as a deductible moving expense.
For those who moved prior to 2018, it may be possible to amend a previous return to deduct moving expenses. This can be done by filing an amended claim. The IRS defines eligible moving expenses as "reasonable costs" for moving yourself and your belongings. This includes the cost of the move itself, storage, and travel. Eligible travel costs include the cost of lodging at a hotel, but not meals. The IRS allots a standard mileage rate of 21 cents per mile for 2024, which can be used to calculate travel expenses. Alternatively, you can keep track of your actual transportation costs and deduct those instead.
If you are reimbursed for moving expenses and the reimbursement exceeds your total out-of-pocket expenses, you must claim the excess reimbursement as taxable income. You cannot deduct expenses that are reimbursed or paid for directly by the government, but you can deduct your out-of-pocket moving expenses if they exceed the amount that was reimbursed.
To qualify for the tax deduction, the timing of your move must be closely related to the start of your new employment. To meet this standard, you must start your new job and work full-time for at least 39 weeks within the first 12 months after your move. An exception to this rule is if your family moves to the new location at a later date due to special circumstances, such as a spouse receiving medical care or a child finishing school near your old home.
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Time and distance tests
To qualify for tax deductions on moving expenses, you must meet two primary criteria: the time and distance tests.
Distance Test
The distance test requires that your new work location is a certain distance from your former home. Specifically, the distance between your new job and your former home must be at least 50 miles farther than your previous place of work was from your old home. For example, if your previous commute to work was 5 miles each way, then the distance from your new workplace to your old home must be at least 55 miles. When evaluating whether you satisfy the distance test, the IRS requires you to use the shortest commutable route between the two locations.
Time Test
The time test requires that the timing of your move is closely related to the start of your new employment. To meet this standard, you must start your new job and work full-time for at least 39 weeks within the first 12 months after your move. There is an exception to this rule if you start your new job months before your family moves to the new location due to special circumstances, such as a spouse receiving medical care or a child finishing school near your previous home. In this case, you can still deduct your moving expenses even though your move occurs long after your first day of work.
It is important to note that the rules for claiming moving expense tax deductions have changed over time. For tax years prior to 2018, federal tax laws allowed taxpayers to deduct moving expenses if their relocation related to starting a new job or transferring to a new location for their current employer. Beginning in 2018, the moving expense deduction was eliminated for most taxpayers and is only available to certain military personnel. These rules are subject to change, so it is important to consult a tax professional or stay informed about the latest tax laws.
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Reimbursements and allowances
For tax years 2018-2025, reimbursements for certain moving expenses are no longer excluded from the gross income of non-military taxpayers. If you are reimbursed for moving expenses and the reimbursement exceeds your total out-of-pocket expenses, you will have to claim the excess reimbursement as taxable income. You can deduct your out-of-pocket moving expenses if they exceed the amount that you were reimbursed.
If you are an active-duty military member, you may be able to claim moving deductions against your taxable income and include them on Form 3903 as an attachment to your Form 1040. Your move must result from a military order and permanent change of station to qualify as a deductible moving expense. You can deduct your unreimbursed moving expenses for yourself, your spouse, and your dependents.
If you moved prior to 2018 but didn't claim the moving expense tax deduction, you may be able to file an amended claim to deduct your moving expenses. Allowable expenses are anything that is reasonable for the circumstances of your move of personal effects and goods. For a long-distance move, you might include the cost of lodging at a hotel on the way to your new home, but you can't deduct expenses for meals. The IRS allots a standard mileage rate of 21 cents per mile for 2024 that you can use to calculate your travel expenses.
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State-specific rules
In general, some states continue to allow deductions for moving expenses on state tax returns if specific requirements are met. For example, in some states, you may be able to deduct moving expenses if your new workplace is outside the United States or its possessions, but you must be a U.S. citizen or resident alien to do so. It is important to note that you cannot claim both a moving expense deduction and a business expense deduction for the same expenses. Expenses that are typically not deductible include house-hunting trips, expenses related to breaking a lease, and costs involved in buying or selling a home.
Additionally, certain members of the Armed Forces and their families can still deduct moving expenses on their federal tax returns. This includes active-duty military members who permanently move to a new base pursuant to a military order, as well as the dependents or spouses of military members who move to a new base or who have died, been imprisoned, or deserted. It is important to note that deductible expenses for military members may include moving, storage, insurance, and travel costs, but only if they are considered reasonable and necessary for the move.
It is always recommended to consult a tax professional or refer to the instructions for IRS Form 3903 to ensure you are maximizing your benefits and complying with the specific rules and requirements of your state.
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Frequently asked questions
No, most people can no longer deduct moving expenses on their federal income tax return. However, there are some exceptions for active-duty military members and their families.
If you're an active-duty member of the military and you're moving due to a permanent change of station, you can deduct most moving expenses for yourself, your spouse, and your dependents. The IRS considers a moving expense to be almost anything you'll spend money on during your move, except for meals.
If you moved prior to 2018, you may be able to amend a previous return to deduct your moving expenses. To qualify, you must have moved for work and started your new job within 39 weeks of moving, and your new workplace must be at least 50 miles further from your old home than your previous workplace.
To claim your moving expenses, you'll need to fill out IRS Form 3903 and attach it to your Form 1040.
