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You can still satisfy this requirement when the 39 weeks are not consecutive and even when it's for multiple employers. You must work full-time for a minimum of 39 weeks during the initial 12-month period that starts on the day you arrive in the new location. When evaluating whether you satisfy the distance test, the IRS requires you to use the shortest commutable routes between two locations. For example, if your previous commute to work was five miles each way, then the distance from your new job location to your old home must be at least 55 miles. The distance between your new job and your former home must be at least 50 miles farther than your previous employer is from that home. The costs you incur for moves within the same town do not qualify for the deduction. Members of the military can also qualify for the exemption more easily.Beginning in 2018, moving expenses are no longer eligible for a tax deduction on your federal tax return however, some states such as California continue to provide a deduction on your state tax return if you qualify. If you’re forced to move due to a job in the military, the exemption still stands. Related: 15 Best Money Habits To Have When Renting an Apartment Military Exemption for Moving Expenses Deduction Other non-travel expenses such as short-term storage also qualified. Some seasonal work was allowed, such as teaching, if the work contract covered an off-season period of fewer than six months.Įxpenses that were considered “qualifying” were travel expenses such as lodging, gas and oil, and the standard mileage rate for distances driven, as computed by the Internal Revenue Service. Time Test: The time test required full-time work for at least 39 weeks within the 12 months after you moved. Here’s how the distance and time tests worked:ĭistance Test: The distance test required your new place of employment to be at least 50 miles farther from your home than your prior job. Up until tax year 2018, you could deduct all of your qualifying moving expenses if you passed two tests, one for distance and one for time. However, legislation is often overturned or rescinded, or in this case, slated to expire for tax year 2026, so it can be helpful to understand the prior provisions.
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This applies to state tax deductions as well, which are modeled on federal legislation. See: These Cities Have the Most People Moving In During the Pandemic Moving Expense Deduction Prior ProvisionsĪs the law currently stands, the moving expenses deduction will be suspended for the duration of the TCJA, which is being enforced from 2018 through 2025. The only exception is if you are a member of the military and are required to move. Now, any moving expenses that aren’t reimbursed by your employer are your own personal responsibility, with no deduction allowed. However, that deduction vanished thanks to provisions in the Tax Cuts and Jobs Act, passed in December 2017. Prior to tax year 2018, the IRS granted a deduction for certain types of moving expenses associated with a change of address. Moving can be expensive, especially if you’re forced to move for a new job.