Whatever the reason for your move may be, there is no doubt relocating from one destination to another brings along with it a whole baggage of stress and anxiety driven hormones that are on a continuous loop till the moving gets done. All that preplanning can be really daunting and not to mention, the excessive cash that flows out of your bank account for the whole relocation process. Here is a Top Guide on Moving Expense Deduction.
You need serious help on how you can manage your whole move within a set budget and not spend too much unnecessary cash as much as possible. Especially if you’re moving for the first time.
Fortunately, you are in great luck! Our guide offers information that can save more than just your bank account-it can save your brain from exploding from the stress, anxiety and panic during your move.
Basic Qualifying Moving Expenses
A certain amount of traveling costs are deducted if you travel either by air or by car, including the traveling costs of all the members of your family. Another form of deduction can be obtained on the transport expenses of your items-including the shipment and packing costs.
Not All Moving Costs are Deductible
Now that we have gotten out of the way things that aren’t deductible for your moving expenses, let’s get on with the things that you must do to get them. You may apply to use the IRS form 3903-it helps to claim the cost of your moving expenses that are deducted under the circumstances of when you are relocating for a new job. There are some requirements you must fulfill to claim your rights on these deductions.
It is true that you get leverage on some things you can do and not have to pay for it but, there are still some things that can cost you a lot more and they won’t be covered under your tax deductibles. Avoid the following acts if you don’t want to hurl another burden on your bank account and have it sucked dry depending on your actions.
The moving expenses deduction rules does not cover the costs of your meals during your travels. If you settle in a temporary residence before permanently living under your own roof, your moving expenses will not be deducted. Some other rules that do not allow the deductions are the remodeling costs of your new lodgings, entering a new lease through deposit or losing that deposit due to any damage or lack of cleaning in your new house.
Requirements for Moving Expenses Deduction
- You must move to your new home within a 12-month period following the time you started working at your new workplace. Whether you start working a few months after you move or if you start working and then relocate to your new place, it is acceptable either way. As long as the timing of your move to the new house and the time of when you start your employment collide or are closely near each other, you are qualified to get some deductions on your moving expenses.
- There is a Time Test that you must go through as well. It entails you to be able to work full time at your new job as soon as you settle in your new house. The required hours are different for the types of employee. The ones working under an employer must work full time at least 39 weeks a year following their move. The weeks, however do not need to be consecutive and it doesn’t matter if you work under different employers. For those who are self-employed, they need to work at least 39 weeks during the first year of their move plus 78 weeks during the 24-month duration following their relocation.
- You must fall under the Distance Test which states that your new workplace should be at least 50 miles farther away from your previous home than your prior workplace location used to be. Measure the distance and if it can satisfy the need, you can claim your deduction rights.
Certain people are exempted from these rules and so can have their moving expenses deducted without needing to go through the previous three steps. The people that fall under this category are relocating military officers, disabled people who have lost their current jobs, family members that are still living of the person who worker abroad of the United States and people who have retired after working abroad from the United States.
Moving does cost a lot. You definitely need to hire local movers to transport your belongings to your new house. But it’s always good to know that there are ways you can save your money.