Tax Deductible Moving Expenses
Before you start deducting moving expenses on your 2010 tax returns, be sure your move meets the IRS moving qualifications.
To qualify for the moving expense deduction, you must meet the distance and time frame criteria. The move must be qualified under IRS guidelines.
Qualifying moves are those that are the result of relocation from your current job or you are accepting a new position from a new employer in another area and must relocate.
Do You Meet The Distance Test and Time Test to deduction moving expenses on your income tax returns?
Let's find out!
The Distance Test: Your move will meet the distance test if the location of your new job is at least 50 miles farther from you old home than you old job location was.
For example, if your old commute was 20 miles, then your new job must be at least 70 miles from your old home in order for your moving expenses to be tax deductible.
The Time Test: In the first year you after you move, you must work full-time for at least 39 weeks.
If you are self-employed, you must work the 39 weeks full-time and then a total of 78 weeks during the first 24 weeks after your move.
You must move far enough away from your current job and home and work at this new job full time for a certain number of months. If you moved in 2010, you will not be able to write any moving expenses off on your 2010 tax returns. But if you moved in 2009, 2008, you bet. Let's find out what can be deducted.
Now that you have determined your move is eligible for tax deductible moving expenses, what items are tax deductible?
~The cost of trips to the area of a new job to look for a home. Your home shopping trip does not have to be successful for the cost to be deductible.
~The cost of having your furniture and other household items shipped, including the cost of packing, insurance, and storage for up to 30 days.
~The cost of getting your family to the new home town, including food and lodging expenses on the trip.
~The cost of lodging and 80% of food expenses for up to 30 days in the new home town, if these temporary living expenses are necessary because you have not yet found your ideal home or it is not move in ready when you arrive.
~Certain costs associated with the sale of your old home and purchase of the new one. These expenses, including real estate commissions, legal fees, state transfer taxes and appraisal, title fees, all can be used as moving expenses up to the allowable dollar limits.
Each situation is different so when considering deducting moving expenses on your income tax returns, always consult your tax account or legal advisor to make sure your deductions qualify.
This information is provided for informational purposed only. As a Northern Nevada Real Estate Agent, I try to provide helpful information for all. If you were looking for way to deduct your moving expenses on your tax returns, I hope this information was helpful. If you are looking to buy, sell or relocate to the Reno or Sparks Nevada areas, please feel free to contact me, I would love to help you with your move!
Tax Deductible Moving Expenses ~ Do You Qualify?
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