How to deduct moving expenses

Family in the middle of a move. Kids playing in moving boxes while mom and dad relax on the couch planning how they'll deduct their moving expenses.Image: Family in the middle of a move. Kids playing in moving boxes while mom and dad relax on the couch planning how they'll deduct their moving expenses.

In a Nutshell

Relocating for work can mean an exciting new start, but it can also come with a high price tag. If you moved for a new job, you may be able to take a moving expense deduction on your federal or even state income tax returns.
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This article was fact-checked by our editors and reviewed by Christina Taylor, MBA, senior manager of tax operations for Credit Karma. It has been updated for the 2019 tax year.

The Tax Cuts and Jobs Act temporarily suspended the moving expense deduction for most Americans between Jan. 1, 2018 and Dec. 31, 2025. This article applies to 2017 taxes.

Moving to a new home can be exciting — and expensive.

From the cost of hiring a moving company or renting a van, to closing costs for buying a house, moving bills add up. The good news is if you move residences to start a new job, you might be able to recoup some of the costs of your relocation.

The IRS and some state governments allow taxpayers to take a moving expense deduction if their move meets certain criteria.

States that allow moving expense deductions have their own criteria for doing so. You can check with your state’s income tax form to find out if a state deduction may be available to you.

Qualifying for a moving expense deduction on your federal return

To take the moving expense deduction on your federal income tax return, the IRS says your move must meet three requirements:

  1. It must relate closely to the start of a job. You can only deduct moving expenses incurred within one year of the day you started your job. That means if you don’t move closer to work within the first 12 months of employment, you will lose your opportunity to deduct moving expenses.
  2. Your new job would add at least 50 miles to your commute if you were to remain living in your old home. For example, if your old job required you to commute just 5 miles from your old home to your former place of business, your commute to your new job would need to be at least 55 miles from your previous residence.
  3. After you move, you must work full-time at your new job for at least 39 weeks in the first 12 months of employment. If you’re self-employed, you must work full-time at least 78 weeks during the first 24 months of your new job.

What you might be able to deduct

If you meet the requirements, you can deduct some expenses related to your move, but not everything.

The IRS says you can claim a deduction for reasonable expenses related to moving your household belongings and personal effects, and expenses related to traveling to your new home. Eligible expenses could include:

  • Transportation for yourself and your family members while moving
  • Lodging during your move
  • Packing and shipping your household goods

Here’s what you can’t deduct:

  • The cost of meals while you’re moving
  • Any of the purchase price of your new home
  • The cost of selling your old house or breaking a rental agreement
  • Any moving expenses for which your new employer reimburses you

What you’ll need to claim the deduction

If you qualify for the moving expense deduction, you’ll need some documentation to claim it.

The IRS recommends you save receipts, bills, canceled checks, credit card statements and mileage logs. Generally, it’s a good idea to hold on to any documents that will verify your moving costs in case a question arises after you file your tax return.

What to file

Of course, claiming any kind of tax deduction can require the filing of additional tax forms. Besides filing your federal income tax return form (such as a 1040, 1040A or 1040EZ), you’ll also need to file Form 3903 for Moving Expenses.

How much you can claim

IRS Publication 521, which covers the moving expense deduction, doesn’t establish a dollar limit on deductible moving expenses. However, even if your moving expenses meet the criteria for being deductible, it’s still advisable to hold on to all documentation related to your move, especially if you’ll be deducting a substantial sum.

Bottom line

If you moved for work in 2017 and meet the requirements, you can claim the deduction on your 2017 tax return. The moving expense deduction can help lower your taxable income, and help lessen your tax obligation while allowing you to recoup some of the costs of your move.

Christina Taylor is senior manager of tax operations for Credit Karma. She has more than a dozen years of experience in tax, accounting and business operations. Christina founded her own accounting consultancy and managed it for more than six years. She co-developed an online DIY tax-preparation product, serving as chief operating officer for seven years. She is the current treasurer of the National Association of Computerized Tax Processors and holds a bachelor’s in business administration/accounting from Baker College and an MBA from Meredith College. You can find her on LinkedIn.

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