Can I Take More Than 1 Moving Deduction in a Year?

Because of the IRS tests, it is difficult to take more than one moving expenses deduction in a year.

Moving can be such a stressful time as you pack and then unpack all of your belongings in addition to becoming accustomed to your new surroundings. To add to your stress, you may need to keep accurate records of your expenses associated with your move if you wish to claim a tax deduction for such a move.

Moving Expenses Deduction Basics

You may deduct the costs of your move if you meet three tests: the move must be closely related to commencing employment at a new job location, you meet the distance test and you meet the time test. The IRS requires that your move be close, both in terms of time and place, to the beginning of a job at a new job location. Generally, this means moving expenses must be incurred within a year of starting at the new job location unless circumstances prevent you from otherwise doing so. Your new house cannot be farther in distance from work than your former home. To meet the distance test, your new job must be at least 50 miles farther from the distance between your former home and job. Lastly, you must meet the time test, which means that you must work full-time for at least 39 weeks during the first 12 months of work at the new job location.

What Moving Expenses are Deductible?

If you meet all of the tests and are eligible to take the moving expense deduction, you may deduct only reasonable expenses of the move. These expenses include the costs of moving your belongings and traveling to your new home, which also includes lodging, but not meals. You may also deduct the expenses for the costs of moving your dependents and members of your household. The IRS specifies that you should only deduct those expenses that are reasonable under the circumstances. To determine the amount of your moving expense deduction, you should use Form 3903.

Employer Reimbursement of Moving Expenses

If your employer reimburses you for the expenses associated with your move, you may not deduct the costs of your move on your income taxes. Moreover, you may have to include the amount of the reimbursement in your gross income on your taxes.

Can I Take More Than One Moving Deduction in a Year?

If you meet all of the tests required for the moving expense deduction, you may take more than one moving expense deduction in a year. However, the time test related to the deduction essentially serves as a limit to the number of deductions you can take in a year. If you move in January, meet all of the tests and work full-time for the first 39 weeks of the year, and then you move again before that calendar year is over, you may be able to claim the deduction. However, because your time test may not be fulfilled by the following April 15, you may want to request an extension and file your taxes in October so you can claim your second moving expenses deduction provided you meet that second time test.

References

• IRS: Are You Moving This Summer?
• IRS: Publication 521, Moving Expenses

Resources

• IRS: Form 3903, Moving Expenses