Jason Hutto, Licensed Taxpayer Representative
Are you self-employed or a wage earner that has recently moved to a new home due to a new job? You could be entitled to a tax break! Job-related moves can be quite costly, but certain moving expenses related to a change in your principal workplace can be tax deductible, if you meet two separate tests.
The distance you are moving and the amount of time you spend working on the job will have a major impact on whether you qualify for the tax break. Moves that are only short hops and jobs that are short-term or part-time generally do not qualify. However, if you can satisfy the distance and time tests, then job-related moving expenses you incur may be tax deductible.
To determine if you meet the distance test, the new job site you want to deduct the moving expenses to must be at least 50 miles farther from your former home than your previous job site was. For example, if your old job was 10 miles from your former home, your new job must be at least 60 miles from that home. If you did not have an old workplace, the new workplace must be at least 50 miles from your old home.
The time test requires you to either work full-time as an employee in the general location of your new home for at least 39 of the 52 weeks following the move you want to deduct moving expenses on your tax return for. If you are self-employed, you must work full-time as a self employed individual for both 39 of the 52 weeks and 78 of the 104 weeks immediately following the move you want to deduct moving expenses on your tax return. This tax requirement can be met either with one job or through a series of full-time positions.
Military personnel do not have to meet the time/distance tests if the move was due to a permanent change of station (PCS). However, you should keep in mind the tax deduction is available for unreimbursed moving expenses for a change of residence if the move is made in conjunction with changes in the location of your job. Since the military reimburses many moving expenses, military members should be careful to take the deduction on unreimbursed expenses only.
Deductible moving expenses include the cost of moving your personal effects and household goods to your new home, storage expenses up to 30 days after the move, and travel expenses, including lodging, to your new home. The cost of meals while traveling, temporary living expenses, or house hunting expenses before or after the move are not deductible.
For more information on deducting moving expenses, you can read Publication 521, Moving Expenses on the IRS’ website, http://www.irs.gov or by calling 800-TAX-FORM.
Jason Hutto has been with JK Harris for five years. He became an Enrolled Agent in 2006 and is now a Licensed Taxpayer Representative. Jason is a member of the National Association of Enrolled Agents and an Associate Member of Charleston’s Chapter of the South Carolina Association of Enrolled Agents.