Moved Recently? Check Out These 5 Tax Tips

Moved Recently? Check Out These 5 Tax Tips

Moving can be a costly ordeal but, if you are moving for job-related reasons, you might be able to lessen the costs bywriting off some expenses on your income taxes.

The Internal Revenue Service allows you to deduct certain expenses, but you’ll have to meet specific criteria. If you moved for convenience, you won’t be able to receive tax deductions.

1. The Time Test

After you move in, you’ll have to be employed full-time for 39 weeks during the first 12 months in the general area of your new place. If you’re self-employed, you’ll need to work full time during those 39 weeks in the first year, and 78 full-time work weeks over the next 24 months following your move. You don’t have to work all those weeks in a row, nor do you have to work for the same employer.

2. The 50-Mile Rule

Your new job must be at least 50 miles farther than your old job was from your old home. It might sound confusing at first, but it’s pretty simple. For example, if your old home was 10 miles away from your job, your new job location must be at least 60 miles away from your old home. Anything less than the 50 miles rule and you won’t qualify.

3. Employer Assistance

If your employer is footing the bill for your move, it will impact what moving expenses, if any, you are able to deduct from your taxes. If your employer is paying only a portion of your moving expenses, be sure to keep track of who pays what because you might be able to write off the things you paid for.

4. Married Couples

For joint returns, only one of you has to meet the above criteria to qualify for moving deductions.

5. Deductible Moving Expenses

Here is an outline of what want to keep track of to write off as tax deductions later:

§  Packing and transporting household goods and personal effects, whether you are moving yourself or hiring professional movers.

§  Cost of insurance for your move.

§  Costs to connect and/or disconnect utilities because of the move.

§  Lodging, meals not included. This also includes one day’s lodging expense in the area near your home if you can’t stay in your old home because your furniture has been moved.

§  Cost of storing your belongings for no more than 30 consecutive days after the move.

§  Cost of trips for you and each household member. You don’t all have to travel the same way at the same time, but you can only deduct expenses for one trip per person.

§  If traveling by car, you can deduct cost of gas, oil, parking fees and tolls. If you don’t keep accurate records of your gas and oil expenses, the standard mileage rate for 2014 is 24 cents a mile. So if you drove 500 miles in your car, you could write off $120 in mileage costs.

For a more in-depth look on moving deductibles, including worksheets, visit the IRS website.