Can You Deduct Moving Expenses for a New Job?

Where you work is a major factor in where you live (duh!), and in the interest of keeping U.S. taxpayers gainfully employed, Uncle Sam will help foot the bill if you have to relocate for work. Awesome, right? In other words, you can deduct moving expenses on your annual income tax return.

Under the right circumstances, that is.

Single taxpayers can deduct qualified job-related moving costs—although an unmarried partner joining them on a move isn’t entitled to the same tax relief. But married taxpayers can both enjoy the tax savings even if only one-half of the pair’s job takes a couple—or a family—to a new home. Still with us?

Before you sharpen your pencils to start tallying up all the money you’ll save by filling out Form 3903: Moving Expenses, you’d better make sure your move passes the following tests.

You’re really moving for work, and it’s kind of far

OK, this one may seem obvious, but we’ll just say it: In order to deduct job-related moving expenses, you have to actually have a job in the place where you’re moving—not just the hope of one.

And we’re not talking about a move down the street, either.

“To qualify for a moving deduction, your new job location must be at least 50 miles farther from your former home than your old job location,” says ZM Ishmurzina, CPA, a partner at Artio Partners in Chicago.

You’re in for the long(ish) haul

Don’t expect to take a work hiatus a few months after relocating for the job, either.

Michael Raanan, a former IRS revenue officer who’s president and enrolled agent at Landmark Tax Group in Santa Ana, CA, says employees must work full time for at least 39 weeks during the first 12 months that follow a move. Self-employed individuals must work for at least 78 weeks during the first 24 months after moving.

That doesn’t mean you’re chained to your desk. Paid and unpaid leave or vacation time counts as employment time, says Gail Rosen, CPA, PC, in Martinsville, NJ. So do involuntary absences because of illness, strikes, shutouts, and natural disasters. And periods of seasonal unemployment of less than six months count if covered by your employment contract, or if you are self-employed.

Rosen says the time test is waived if you are laid off a job in which you could have reasonably satisfied this test, fired for reasons other than willful misconduct, or transferred for the employer’s benefit.

You’re keeping score—of your qualified expenses

If you’ve passed these tests, it’s time to tally up all the expenses you can—and can’t—deduct.

Travel expenses for the move are deductible, including transportation and lodging for you and members of your household, including pets. Expenses for the day of arrival are deductible, too.

The cost to pack, ship, unpack, and store your belongings is deductible as long as it happens up to 30 consecutive days after the move date and before the arrival date to a new location. “Additional expenses can be claimed if you move overseas,” Rosen says.

Reasonable costs only. Although there’s no dollar limit on your deductible expenses, don’t expect to get away with anything truly extravagant. And if your employer reimbursed your moving expenses, Raanan says, you can claim a moving expense deduction only if the reimbursement is included in your wages.

No add-on vacation costs. Don’t expect to squeeze in a vacation en route and deduct for that, too. “You also have to move by the shortest and most direct route available by the conventional mode of transportation used and in the shortest time commonly required to travel that distance,” Rosen says.

Also excluded: Sadly, you cannot deduct any meals, any part of the purchase price of your new home, car tags, driver’s license, expense of buying or selling a home (including closing costs, mortgage fees, and points), cost to enter or break a lease, home improvements to help sell your home, or the loss on the sale of your home. Deal with it.

Check your calendar

The expenses must generally be incurred within a year of your work start date at the new location, but Rosen says expenses may be postponed in certain situations—such as if you delay a move to allow your child to finish school.

You can deduct expenses in the year you pay them, even if you haven’t satisfied the minimum employment period by filing time, says Rosen. You can also wait and claim the deduction on an amended return when you have satisfied the minimum employment period.

If you deduct and for some reason it turns out you can’t qualify after all, you’ll have to either include the amount you deducted in your next year’s income or file an amended return for the year of the deduction.

Bottom line

“The best thing to do is save any and all receipts and/or canceled checks you think, question, or wonder might be deductible and talk to a tax professional to make sure you maximize your deduction without getting yourself in hot water with the IRS,” says Raanan.

Maintaining Two Households When One Doesn’t Sell:

Say you put your house up for sale, do everything you can to make it desirable to buyers, and it sits idle despite dropping the price.  Sometimes, no inexplicable reason exists to explain it, but you’ve already scheduled a moving day with the moving company to your new home and cannot postpone it any longer.  Is it feasible to transform your former residence into a rental property and simultaneously maintain two households? Find out whether renting out and owning two properties is for you.

Review Your Financial Portfolio

Before you saddle yourself with rental property ownership on top of your home, review your finances and budget.  Could you even afford to take on a second mortgage even if it’s only a temporary acquisition?  Remember that you must guarantee that you find a trustworthy tenant who pays rent on time and in full and plans to reside in your old place for an extended period of time.  Otherwise, the money you were counting in is nonexistent until you fill the vacancy.

Double the Bills

You know how you always happily anticipate receiving your mortgage and utility bills?! Imagine receiving two sets of bills that you must pay – not fun.  Maybe moving isn’t the best option at this time, and you should postpone moving services, especially if you’re underwater with your first home.  When calculating how much rent you need in order to cover your second home’s expenses including mortgage, insurance and utilities, research the going rate in your area, recommends Zillow, and adjust the rent within that range.  Falling behind on either mortgage payment, says US News, could cause you more financial stress and create significant credit problems.

Are You Landlord Material?

Take a hard look at yourself and ask this question, “Could you become a landlord?” Factors that indicate you’re not the best candidate, says Zillow, include laziness, unskilled at fixing things, too busy, lacking savings, easily stressed out and not being a people person.  Understand that becoming a landlord is another full-time job, so if you’re not prepared to handle everything that comes with a rental property, hire a property manager to oversee the home.

Document Alterations

If you decide to convert your former home into a rental property, you may also need to convert your mortgage terms with your lender and update and add to your homeowner’s insurance policy, says Money Girl.  One benefit to owning a rental property is that you can deduct expenses from your taxes which helps your bottom line, statesUS News, especially when you’re directly involved with the upkeep.

Rental Responsibilities

Be aware that when you are the landlord, you are responsible for your property and may be at the tenant’s mercy when they need something fixed or replaced.  Extra time and effort must be devoted to the rental, and you must ensure you have the money and a plan for handling emergencies.  Updating and servicing your appliances before you welcome renters is important to keeping them happy.   If you own more furniture than you need to furnish your new place, you could leave it at the rental for your tenant’s use or put it into storage through FlatRate Moving.

How to Help a Pack Rat Move:

Helping someone move is never fun. You eat up a precious Saturday schlepping boxes down dangerously narrow stairs while your friend or family member (who claimed to be totally great at moving, by the way) mostly seems to be taking breaks and carrying down “valuable” lampshades one at a time.

It’s hard and frustrating work. But if your pal is a pack rat, a frustrating day can quickly turn into something bigger. Way bigger.

Whether the friend is a hobbyist collector, an indecisive type who seems to keepeverything, down to old peanut butter jars, or a borderline hoarder, managing the move can be emotionally and physically trying. Here’s how to deal with it.

Allow enough time for sorting

When people have been collecting and storing stuff for years, moving them will take more than a few hours and a dozen boxes. Even if they’re just renting a tiny apartment, the amount of stuff to go through can be surprisingly vast. Start by giving yourself enough time. Plenty of time.

“A studio apartment stacked to the ceiling and filled with stuff from wall to wall can take a week or more to organize and clean,” says Emma Gordon, storage specialist at Clutter Storage, an on-demand storage company based in Culver City, CA.

You’ll also want to equip yourself with more supplies than usual.

You really want to help? “Come prepared with plenty of boxes and large garbage bags, disposable gloves, cleaning supplies, and disinfectant,” Gordon says.

Consider the emotional side

You may feel frustrated when you see the amount of work to be done, but don’t forget: This is hard for everyone.You did say you were going to help, right?

“It’s important to remember that as overwhelming as it is for you, your friend or family member is probably feeling vulnerable, embarrassed, or anxious—on top of feeling overwhelmed by the work ahead of them,” Gordon says.

The best route to take: patience. Don’t treat the individual’s collected treasures like garbage. Go slowly, work through each room, and really listen to what he’s telling you. Try to see things from his point of view.

Set a plan to declutter

Odds are, there will be a lot of stuff in the home that isn’t really needed anymore, but may be difficult for the owner to confine to the dustbin of history (and the actual dustbin). Make the owner feel better about the process by keeping the memory alive and donating some items, especially if the person you’re helping has a favorite charity that accepts gently used goods.

This process may be easy, or it may be grueling. After all, “there may be underlying issues that make it difficult for the individual to get rid of their stuff,” Gordon says.

Have a battle plan

Once you’re ready to go and the individual is (mostly) on board, it’s time to dive in. Having a plan in place can dramatically cut down on time, as well as emotional and physical strain.

Gordon recommends designating places to put stuff as you go through it.

“Clear an area for sorting items into ‘keep,’ ‘give away,’ and ‘trash,’” she says.

Once you have a designated drop point, start in one room and work through each part in the house. Carry a durable laundry basket or large plastic bin with you so you can quickly group and move items to the right spot.

But don’t expect it to be easy.

“Be aware that this is the most time-consuming part of the process, and also the most stressful,” Gordon says. Fun! Aren’t you glad you volunteered for this?

Keep deadlines

Odds are, your friend or family member was already feeling emotional before the move. Now that you’ve started working, you may find the individual dragging her feet or becoming argumentative. Rather than rise to the fight, it might be better to find another way to keep things on track. Gordon recommends using the charitable donations to your advantage.

“Some charities offer donation pickup,” she says. “By scheduling a pickup, it compresses the process into a tighter deadline. It makes the process of actually getting the stuff out of the home so much easier.” Every bit helps. Trust us on this.

7 Steps to Selling a House:

• 4
• Set Your Home Sale Price
  With the help of insightful local market data available on ZipRealty.com, your agent will be able to help you determine what your home will sell for in today's market. Learn more.
• 5
• Get the Word Out
  Your agent will create a winning marketing plan for your home to target active, interested home buyers searching in your area, both online and in person.
• 6
• Negotiate the Sale
  Review offers from prospective buyers with your real estate agent and decide on the offer that's right for you. Learn more.

7 Things People Forget to Do Before They Move:

You packed everything perfectly, including that dining room chandelier, the big-screen TV, the vintage ’70s “Dukes of Hazzard” T-shirt collection. You even got your dog’s medical records from the vet. But something’s keeping you awake at night as your move draws nigh. You know you forgot something.

Don’t worry, keep packing. We assembled this handy checklist of things people often forget to do—or don’t even realize they should take care of—so you can make sure you’re covered and can move and settle down in your new digs with ease.

1 month before: Cancel recurring charges

Taking care of a gym membership or other subscription services may fall by the wayside during the madness leading up to moving day. Worse, those recurring charges will keep mounting on your credit card while you’re in the throes of unpacking. Get a jump on canceling these at least a month before your last expected day of use, especially since many gyms require a 30-day notice.

Can’t get out of your contract or transfer your gym membership to a facility by your new home? Sell it through online classifieds such as GymTransfer (yes, most gyms allow this!). Don’t forget to unload any prepaid class cards, too.

On the flip side, important recurring charges on your credit card—such as mail-order medications—might be canceled if your address change hasn’t caught up with billing information. So compile a list of charges and make the effort to call these companies and give them a heads up to avoid disruption in service.

2 weeks before: Call your car insurance company

The Department of Motor Vehicles advises people in the process of moving to closely manage their car insurance during the transition, as states have varying levels of required coverage. Even if you’re staying in the same city, rates can differ from neighborhood to neighborhood. So call your insurer well before the move to find out the parameters and deadlines for updating coverage at your new address.

2 weeks before: Change your address early

Most people know the U.S. Postal Service offers an online form to quickly change an address for all of your mail, but that doesn’t mean you should wait until the last minute to fill it out.

“To make sure mail arrives at your new home in time for your life there, complete the form about two weeks before your move,” says Desmond Lim, founder of QuikForce, an on-demand website that links people with professional movers. That way “you should see the first of your forwarded mail by the time of move-in.”

1 week before: Organize your finances

Important financial tasks are often forgotten in the whirlwind of moving, says consumer finance expert Kevin Gallegos, vice president of Phoenix operations for Freedom Financial Network. Since losing track of bills among piles of boxes is all too easy, Gallegos recommends setting up systems before a move that can easily transition from old home to new. For monthly bills such as phone, rent, or mortgage, it can really help to set them up for autopay, which you can typically do through your bank or the billing company.

“This can help ensure on-time payment during a hectic time,” he says. Whatever system you choose, decide which household member will be responsible for paying which bills. And as moving often incurs unexpected costs, be sure that you’ll have enough money in designated accounts at time of payment.

1 day before: Snap pictures of your electronics

Those cables in the back of your TV and modem that keep your life wired? They don’t make sense now and will make even less sense when they are tangled in a box. A simple solution is to snap a picture of the setup before you take your electronics apart—and coil the cords and label them with masking tape, for good measure.

1 day before: Pack your plants

Do you have a special plant (maybe that hydrangea you planted for your child’s birth or your mom’s prized azaleas)? To make sure you aren’t forced to leave it behind in your rush, make a list of what plants you want to take with you and put a plant plan in place. Don’t put your shovels into the moving van until the last minute—you’ll need them to carefully dig up root balls. Buy large buckets beforehand and use them to transport each plant.

1 day before: Stock a go-to box

Jen Sandlin, an agent with Cornerstone Real Estate in Boston, reminds movers to “set aside one box for the first 24 hours” in your new home. “Pack paper towels, cleaning supplies, clean sheets, towels, paper plates and silverware, toilet paper, and maybe even a bottle of bubbly to celebrate all your hard work, picnic-style.”

LOCAL MOVER IN SAN JOSE, CA

Are you moving within a 100 mile radius of our location in San Jose, CA? Our local moving service is perfect for you!

You’ve found a new home and you and your family are excited to get started in a new neighborhood. First, you have to go through the endless labor of planning your move and carrying all of your belongings to your new address. Speedee Movers can do the work for you so you can relax.

We offer local moving services in San Jose. Our experienced and professional local movers will handle your belongings with care. We work quickly and diligently to get the job done.

A professional moving company you can trust!

The basic cost of your local move is determined by the number of movers, the time it takes to load and unload your belongings, and the time it takes to drive between your old and new residences.

Our local mover rates include:

• Door to door service
• Loading and unloading
• FREE - Industrial strength blankets, wrapping paper, and tape
• FREE - Use of wardrobe boxes
• FREE - Basic insurance of 60 cents per pound
• Disassembling and reassembling of your furniture
• No Booking fee or deposit required
• FREE - Taxes, tolls and mileage
• NO EXTRA CHARGE for using any stairs and/or elevator
• Guaranteed move dates
• Time starts at your door

Speedee Movers will also match or beat any reasonable quote from any insured and licensed reputable moving company!

 

Local SF Moving & Packing Tips:

Getting Organized

1. Start early- Almost everyone has more stuff than they think they do, and almost no one leaves enough time to pack it.
2. Room Lists- Start by forming two room lists, one for your current place and one for your future place. This will help you manage what has to go where.
3. Room Inventory- Go to each room and write down the types of things that need to be packed: furniture items, length of shelving, closets, etc.
4. Time Allotment- Make sure to leave enough time. The most common timeframe reported by people moving is that it takes a month to pack. One study reported that it takes 4-5 hours to pack an average dorm room, so that should give you an idea of what's involved.
5. Calendar- Pull out a calendar and plan by day when each room will be completed.
6. Delegation- If you're moving with family members, agree with them exactly while tasks they will be doing and the date they will be finished.
7. Track your progress- at least once per week track where you are against the date on the calendar. Revise your plan if you're falling behind.

General Packing Tips

1. Pack a suitcase- For each member of the family moving, pack a suitcase as if you're all going on a 3-day vacation, including changes of clothes, medications, eyeglasses, toiletries, etc. Keep the suitcases separated from all the other items to be moved, such as in your car, at your new workplace, etc. so you'll have everything you need for the first few days without searching through boxes.
2. Create "Open Me First" boxes- Pick one or two boxes per room as "Open Me First" boxes. Put in them the things you'll need first at your new location. Then mark the sides of the boxes so you'll know which ones are which.
3. One at a time- Wherever possible, work on packing just one room at a time (instead of several all at once) to keep things focused and organized.
4. Less is more- Use packing as a way to clean out belongings for donations, a yard sale, and/or the recycling center. Aim to eliminate 1/3 of your belongings. You'll save time and expense.
5. Off the floor- Instead of the floor, use a completely cleared-off table top or counter in each room for packing boxes. You'll find you get much more accomplished.
6. Tracking small parts- When taking apart items to be moved, such as tables, securely tape screws and other small parts securely to the underside of the item. You'll always know where to look and save time putting things back together.
7. Save space- Use towels, pillows and t-shirts you're packing as extra padding around fragile items. It will save room in your boxes.
8. Criss-cross tape- Tape boxes along the seams where the flaps meet together. Then tape perpendicularly at the center of the first tape, forming a cross.
9. Stacking- Stack boxes with the heaviest on the bottom, lightest on top to prevent crushing.
10. The 30-pound rule- Keep each box below 50 pounds absolute maximum and below 30 pounds wherever possible. Heavier boxes lead to injuries, are much more likely to burst their tape or seams and tend to get dropped.
11. Scale- Keep a bathroom scale in the room you're packing so you can keep the boxes below the weight limits.

Packing Electronics

1. A picture is worth 1000 words- Use a digital or cell phone camera to take pictures of how complicated wiring (computer cords, speaker wires) is hooked up. Be sure to use plenty of light and careful focus so the pictures will be clear. Print each picture and put it in the top of the box holding the item. This will make hooking up the items in your new place much easier.
2. Original is best- Always use the original packaging when available. (I realize that most of us don't have the original packaging for much of anything, but I thought I would bring it up anyway).
3. Double boxing- For especially fragile electronics, pack them first in a box with an excessive amount of biodegradable packing peanuts. Then pack that box in a larger box filled with biodegradable packing peanuts. This two-box system seems like a pain but seems to do a better job isolating items from jarring impacts.
4. No loose ends- Wrap each cord carefully with cable organizers, heavy twist ties or heavy rubber bands. Never throw unwrapped cords into boxes- they get tangled and caught on other items.
5. Cord labels- Consider getting a label maker and labeling the end of each. Then you'll know exactly which cord you're seeing and where each end connects when you put things back together.
6. The two-inch rule- Use at least 2" of biodegradable packing peanuts around each side of fragile items.

Box Inventory and Labeling

1. "Fat" is in- Use the thickest, darkest marker you can find for labeling boxes. Pencils, pens, tin or light markers are almost impossible to see even just a few feet away.
2. Two sides- Label each box on the two broadest sides, opposite one another. That way if a box gets turned, you can still identify its contents.
3. Abbreviate room names- Start box labels with the abbreviated name of the room followed by a box number, such as "BTH2-6" for "second bathroom, 6th box." You can then track each box to make sure everything arrived safely.
4. Label "Open Me First" on boxes where it applies.
5. Mark "Fragile" where appropriate.
6. Identify contents- Identify the major contents and where they came from, such as "Medicine Cabinet" or "Linen Closet- Towels and Wash Cloths."
7. Box Inventory- Keep a clipboard and write down each box's room, box number and contents (graph paper is great for keeping things recorded neatly).
8. Verifying delivery- When unloading, check off each box as it gets unloaded at your new place. Then you'll know everything arrived safely.
9. Labels out- Ask movers to stack boxes in your new place with the labels facing out so that you can easily spot a specific box.

Letting People Know

1. Post Office- File your change of address with the Post Office at least 30 days prior to the date of the move.
2. Referrals- Ask everyone you notify for a referral in your new area.
3. Records- Get copies of your existing records (transcripts from schools, medical records from doctors, etc.) while you're notifying the changes of address.

Change of Address- Who To Notify

1. Accountant/tax preparer; Alumni associations; Attorneys
2. Babysitter/ child care provider; Banks (auto loans, checking accounts, credit cards, home equity, IRA's, mortgage, safe deposit box, savings account); Broker; Business cards (order new ones if applicable)
3. Cell phone provider; Child care/ daycare; Chiropractor; Courts, especially for traffic tickets or local disputes; Credit bureaus; Credit card issuers
4. Dentist; Department of Motor Vehicles; Diaper service; Doctor; Dry cleaning pick-up and delivery
5. Family members and friends
6. Health clubs; House cleaning service; House of worship
7. Insurance providers (auto, health, life, other vehicles); IRS (form 8822)
8. Lawn care; Luggage tags (replace existing ones)
9. Magazine subscriptions
10. New business cards; New employer; Newspaper subscriptions
11. Old employer; Orthodontist
12. Parent-teacher association; Passport; Pet sitter/ dog walker/ pet day care; Pharmacy (BONUS: get year-to-date expense summary for taxes); Physical therapist; Physician (BONUS: get referral for new location); Post office; Professional organizations
13. Retirement plan holders; Return address labels (order new ones)
14. Schools (BONUS: get copies of transcripts); Snow removal service; Social Security Administration; Swimming pool maintenance (pool cleaning, pool opening or closing); Swimming pool memberships
15. Veterinarian BONUS get vet records and recommendations
16. Water delivery service

Moving With Kids

1. Get a children's book on moving for smaller kids. Consider "The Berenstain Bears' Moving Day."
2. If appropriate, let children pick their room.
3. If possible, let kids pick a decoration (poster, light switch, name banner, etc.) for their new room.
4. Pack a kid's sized suitcase and let each child pick out a special toy to keep with them and a special outfit to wear on "new home day."
5. If the child has a special dish or cup, include it in the kitchen "Open Me First" box so familiar items await them at their new place.
6. Consider unpacking the kids' rooms first, or at least their "Open Me First" boxes to help them settle in.

Open Me First Box: The Kitchen

1. Aluminum foil or plastic wrap
2. Break-proof or disposable flatware, cups, and plates
3. Coffee maker and coffee (don't forget the filters!)
4. Dish detergent
5. Frying pan and spatula
6. Pet food and bowels
7. Scissors
8. Tea kettle

Open Me First Box: Main Bathroom

1. Bath mat
2. Bath towels
3. First-aid kit (aspirin, band-aids, hydrogen peroxide)
4. Shampoo
5. Shower curtain and rings
6. Soap
7. Toilet paper
8. Toothbrushes and toothpaste

Open Me First Box: Tool Room or Drawer

1. Duct tape
2. Flashlight
3. Flat-head screwdriver
4. Hammer
5. Level
6. Phillips-head screwdriver
7. Picture hangers
8. Tape measure
9. Utility knife

Moving Day

1. Again, start early- You want to have everything as organized as possible prior to the arrival of the movers.
2. Use sitters- Recruit help in watching your small kids and pets on Moving Day. Your attention will be needed for the nuts and bolts of the move.
3. Have food ready- Whether you have professional movers or friends and family, having coffee, orange juice, and bagels or donuts available will make it easier for everyone to get started.
4. Cell phone numbers- Make sure you have the cell phone number of the driver of the truck entered into your cell phone, and that the driver has yours in case you get separated or have a problem.
5. Proper payment- Almost all professional movers will demand payment in full and in cash before they will unpack a single box. Make sure you have payment ready.
6. Directions- Have directions and a map ready for anyone will be driving between your old place and your new place.

 

1. Unpacking Plan- Just like with packing, have a plan for unpacking. Otherwise you're likely to end up frustrated with a sea of half-opened boxes with your necessities still "missing in action."
2. Prioritize Rooms- Focus on "Open Me First" boxes in the bathrooms and kitchen first.
3. Trash and Recyclable Boxes- Keep at least one trash bag (for the real trash) and one large emptied box (to hold used packing paper and biodegradable "peanuts") available in each room BEFORE you start the heavy unpacking.
4. Time Limits- Set an objective of unpacking a certain number of boxes each day until all the boxes are all unpacked.