How to Deduct Moving Expenses On Your Tax Return

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This being an update to an earlier post from 2017, it is vital to stress that in light of recent tax changes, the ways to deduct moving expenses on your tax return have been eliminated for most taxpayers until at least 2025. Therefore, the process of deducting moving expenses from your tax return is not applicable under current tax laws.

What did previous provisions deduct?

The previous provisions allowed for the deduction of expenses for moving services provided the move was closely related to the start of work at a new location. This could be a new job, a transfer within the same company, or a relocation due to your first job. The move had to occur within the United States. The expenses were deductible within one year from the date you started work at the new location. In the event of moving abroad for work, different rules are applied depending on a number of relevant factors.

Calculator and Pen on Table needed to deduct moving expenses on your tax return
Deducting moving expenses from your tax return is not currently applicable

In addition to being job-related, the IRS had two other requirements that needed to be met:

  • Distance test: Your new workplace needed to be at least 50 miles farther from your previous home than your previous work location. If you were unemployed or worked from home prior to the move, your new workplace needed to be at least 50 miles from your old home.
  • Time test: You had to work full-time in the vicinity of your new job location for a minimum of 39 weeks within the 12 months following your move. For self-employed individuals, this requirement was at least 78 weeks within the 24 months after the move.

There were also specific circumstances where the above rules did not apply. Such as if you were a:

  • Member of the armed forces,
  • Retiree,
  • Survivor of a deceased individual working abroad,
  • If you lost your job due to disability or reasons other than willful misconduct.

In expectation of new deductions

However, as noted, these rules are currently not applicable due to tax changes implemented from 2018 to 2025. Please consult with a tax professional or check the IRS website for updates. They will first post about other potential ways to deduct moving expenses on your tax return once available.

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