Thursday, August 13, 2009

Writing Off Job-Related Moving Costs

Unfortunately, job-related moving expenses are amongst the more commonly forgotten tax write-offs. However, as Don’t Mess With Taxes—one of my favorite tax blogs—explained in a new entry, taking advantage of incentives for moves related to a new job are actually more straightforward then you might think.

Moving tax tips: One of the nice things about moving for a job is that you can deduct some of those costs. Even better, you don't have to itemize to claim these expenses.

You must, however, meet a couple of basic requirements.

The move has to be work related. You can't simply write off a change of scenery.

You also must meet the IRS' time and distance tests.

"Time" means you have to work at your new location for at least 39 weeks in the first year after your move.

"Distance" requires that your new job be at least 50 miles farther from your previous residence than your last office was from that home. Basically, the IRS isn't going to help pay for a move that simply provides you an easier commute.

If you're reentering the full-time workforce, you can claim the deduction even if you don't have a job when you move.

If you're married and file jointly, only one spouse needs to meet both the time and distance tests.

Filing basics: As for filing itself, you do have to fill out another piece of tax paperwork, Form 3903.

And, no surprise here, the IRS has plenty of moving deduction do's and don'ts. Here are some of the more interesting ones.

Costs to transport pets are deductible.

So is the cost to have your car hauled to your new home.

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