Are My Moving Expenses Tax Deductible?

In 2020, people moved all over the country, whether it was within the same area or all the way to the other coast. It turns out that even a pandemic can’t make people stop moving.

It’s no secret that moving is stressful, but if you’re able to take some of the burden away with a future tax deduction, it may make it a bit easier on your budget.

Are you planning a move, but you’re not sure if the IRS still lets people claim moving expenses on their tax returns? This is an important piece of information to know, especially if you took advantage of that deduction in the past.

Keep reading to learn about whether your moving expenses can be tax deductible or not.


What Counts as Moving Expenses?

For any type of moving costs to be considered deductible, they have to be both reasonable and necessary to the actual move. This means that while you may pay for some things related to moving, such as restocking your pantry or buying new locks for the front door, these are not necessarily related to the move itself.

Some expenses that would be considered tax deductible in certain situations include:

  • Rental vehicles
  • Short-term storage lockers or rooms
  • Packing equipment
  • Moving insurance
  • Gas and mileage on your personal vehicle
  • Oil for your vehicle
  • Parking fees or tolls
  • (For a long-distance move) lodging or a hotel

If you’re planning to get your vehicle mileage covered, the IRS has a specific rate that you can use when you plan moving costs before the big day.


Are My Moving Expenses Tax Deductible?


Are Moving Expenses Always Tax Deductible?

In the past, many Americans were able to claim a tax deduction on their federal tax returns for most moving expenses.

Now, however, only active members of the military and their immediate family members (within their household) may use the deduction. Further, these individuals are only permitted to tax deductions if the relocation is related to a change in station.

Specific states, including New York, Arkansas, California, and Hawaii, may allow moving expense deductions on state taxes. This still does not impact the law at the federal level, regardless of where you live.

How to Plan for a Move and Minimize Moving Costs

If you’ve realized now that you won’t be able to claim tax deductions when filing taxes, you need to try and create a solid moving budget that won’t be too difficult to follow.

The first thing to do is try to find free packing supplies, including boxes, tape, scissors, labels, and more. You may already have some of these things lying around, and if you don’t, a friend or family member might.

The next thing to consider is the date and time you plan to move. Moving in the peak season (May to August) is going to generally cost a little bit more, as will moving on the weekend. You should plan to work with a residential moving company that will help you move mid-week, mid-month.

Lastly, pack all of your items yourself and get rid of things that you don’t want or need. You’ll save money by doing this now versus later when you’re unpacking.

Plan for the Perfect Move Today

Whether you’re able to deduct your moving expenses on your tax return or not, moving can be difficult without planning ahead. Take the time to look at your budget, hire professional movers, and get the job done without any extra hassle.

Don’t wait to learn more about how you can settle into your new home either. Check out the rest of our website for some top tips that will help you be happy in the new space.



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