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Moving Expenses |
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If you incur moving expenses in connection with a change in work location, some of your expenses may be deductible, whether or not you can itemize deductions. You MUST meet the "distance" and "time" tests. Distance Test - In order to qualify for any deduction for moving expenses, your new principal work place must have increased your commute by 50 or more miles. That is, the distance from your new work place to your old home is at least 50 miles more than the distance from your old workplace to your old home. Time Test - Also, you must be employed at your new location for at least 39 weeks during the 12 months following your move. If you are self-employed, you must work full time in that general area for at least 39 weeks during the 12 months AND a total of at least 78 weeks during the first two years. NOTE: The tests above may not apply if you retire due to disability, or you are laid off or terminated for a reason other than misconduct, or are in the Armed Forces and you moved because of a permanent change of station, or a retiree or survivor moving TO the United States. The following are DEDUCTIBLE moving expenses:
The following moving expenses are NOT DEDUCTIBLE:
If you are reimbursed by your employer for deductible moving expenses, the total of these reimbursements should be shown in box 12 with a letter "P" on your W-2 form. This amount is NOT included in your taxable wages. If your actual expenses EXCEED the amount shown, you may be able to deduct the excess expenses. On the other hand, if your actual expenses are LESS than the amount shown, you may have to report taxable income. If your employer paid other expenses for your relocation that are NOT allowed as deductible moving expenses, these expenses are taxed to you as additional wages. |
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Click here to return to "Frequently Asked Tax Questions" |
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