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Can you claim moving expenses?

Verified Movers Team Blog Moving Resources

When the time comes to move to a new home, things are about to get crazy. Going through a move can be really challenging in the vast majority of cases. Due to the sheer complexity of an average move, it is easy to get lost in the whole process. It is not just about dealing with budgeting of the event and trying to claim moving expenses. One of the key things that you have to do is to find a reliable moving company to assist you. Having reliable movers by your side is really important at such times as they can make your move a lot easier with their experience and diligence. Then you have to settle a moving date and organize everything else accordingly. Taking care of your medical records and school records for kids is one more thing to take care of.

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One of the most common reasons for moving is because of a job

The reasons behind the move also play a really important role in the whole process. If you by yourself decide to move to a new home, then you are the one who has to deal with all the good and bad things coming out of such a decision. In the past when you were supposed to relocate because of a new job or in order to look for a job in another city, it was possible to claim moving expenses. However, things have changed a bit in recent years. In December of 2017, the Tax Cuts and Jobs Act was passed. However, the deduction of moving expenses is gone from the 2018 tax year all the way through the 2025 tax year. It will come back after 2025 though unless the Congress decides to eliminate it for good.

First thing you have to know in order to claim moving expenses – You can’t claim all expenses

When it comes to money, especially our own, sometimes it is hard to stay objective. That is something that comes naturally to us as we are raised in a world that revolves around it and we directly connect our survival with it. However, when it comes to money we have to do our best to stay as objective as possible. Stopping in a restaurant to eat on our way to a new home is not really something that one should expect to get a refund for. Things like hiring one of the cross country moving companies Oklahoma offers, however, are something that does make sense. Simply put, not all the possible expenses qualify for you to claim them as moving expenses.

You can't claim moving expenses for meals
You cannot claim all moving expenses

The expenses that do qualify are the costs of packing and shipping your household items and anything else that belongs to you. The costs of your travel and lodging also count as moving expenses that you can claim. However, you will be unable to claim moving expenses for meals that you eat along the way. It is thus important to note that things such as hiring some interstate movers North Dakota offers will be not just a good thing in general for your move as they will be able to elevate it on a higher level and make it a lot easier for you to get to your new home, but you will also be able to claim those moving expenses regarding the moving company’s services. As these are generally a really big entry on the list of moving expenses, these are great news.

A note about Form 1040

When it comes to filling this form for your annual income tax return, you have to not one important detail on how to claim moving expenses. The deduction of these expenses is “above the line” in the section regarding adjustments to income that is on the first page of the Form 1040. What this means is that there is no need for itemizing to claim in. This deduction can be claimed along with the itemization of your deductions or with the standard deduction. Furthermore, it is important to bear in mind that there are three tests that determine whether you are eligible for a tax deduction and you must meet all three of them.

MacBook Pro, white ceramic mug,and black smartphone on table
There are three tests to satisfy that determine whether you are eligible

Test 1. “Distance”

Your now ex-home has to be 50 or more miles away from the location of your new job than your ex-home was from the old job’s main location. It may sound complex, but it is not, so bear with us. Here is an example – Let us say that you live in Oklahoma. Your old job was around 15 miles away from your old home. Your new job is in California. With your new job being hundreds and hundreds of miles further away from your old home than your old job, you are by far in the clear when it comes to the distance test. It is important to emphasize that members of the military are an exception to this rule. If they are active members they do not have to fulfill this test.

Test 2. “Closely related to starting work”

This one is simpler. You have to relocate within one year before or after the date you start working at your new job. So if you start working in California on August 10th, you must move within 364 days before or after that date. This rule also has its exception and it regards with people who work outside the USA. If they retire and move back to the States, they can still claim moving expenses even though they are not really starting working on a new job.

Test 3. “The other time”

This is the last test and you are eligible if you satisfy either of these two conditions:
1. You work for at least 39 weeks of full-time employment in 12 months after your move.
2. You work for at least 39 weeks of self-employment in 12 months after your move. However, you also have to work for at least 78 weeks in 24 months after the move.
Make sure, if possible, that you really do fulfill each of these conditions before you actually go through your move.

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