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Have you recently hired a professional moving company to help you relocate to begin a new position? If so, now is a good time to begin thinking about your tax return. Why? Some moving expenses are tax deductible and the more you know and understand about these expenses prior to your move, the higher your chances of qualifying for every benefit available to you.

As a trusted Dallas moving company, Black Tie Movers understands how overwhelming both moving and taxes can be, so we’ve outlined some of the most important things you should know before moving.

How to Determine Your Eligibility

Not every move is eligible for tax deductions; your move must be related to a job. If you did relocate as a result of accepting a new position, there are two major tests you must pass to be eligible:

The Distance Test

The distance test is the first step in figuring out whether or not your move is tax deductible. If you’re hiring local movers for a relocation that is entirely in-town, you won’t be able to deduct moving expenses.

In order to be eligible for tax deduction, your new job and old home must be 50 miles or further away from your old job. For instance, if you had a 15-mile commute from your home to your old job, your new job must be located 65+ miles away to qualify for deduction.

Have you recently hired a professional moving company to help you relocate to begin a new position? If so, now is a good time to begin thinking about your tax return. Why? Some moving expenses are tax deductible and the more you know and understand about these expenses prior to your move, the higher your chances of qualifying for every benefit available to you.

As a trusted Dallas moving company, Black Tie Movers understands how overwhelming both moving and taxes can be, so we’ve outlined some of the most important things you should know before moving.

The Time Test

In addition to passing the distance test, you must also pass the time test. For you to pass this test, you must work at least 39 weeks (nine months) of the year from the day you arrive at your new home. It’s important to note that you remain eligible even if you don’t work 39 consecutive weeks or if you begin work with a different employer in your new area.

Also important to note is that the IRS does not require you to work a more than a certain number of hours a week, they defer to the generally accepted standard for your industry.  Additionally, married couples filing jointly need only have one spouse who satisfies both the time and distance test to qualify.

Tax Deductible Moving Expenses

Expenses incurred related to the moving services you must purchase are eligible for deduction. These expenses include:

  • Hiring long distance movers
  • Packing supplies
  • Fees charged by your Dallas moving company
  • Storage costs (for a maximum of 30 days)
  • Costs associated to disconnecting and connecting utilities
  • Lodging during travel
  • Cost to insure your belongings

There are other expenses that may qualify for tax deduction and the best way to take advantage of every one you can is to work with your accountant.

When to Claim Your Deduction

The time test requirement for deducting your moving expenses means that you’re able to take the deduction in advance of actually satisfying the deduction’s requirements. You won’t know if you are eligible for the deduction for at least 12 months after your move, so the IRS allows you to take the deduction in advance of those 12 months elapsing.

When it’s time to fill out your 1040, you’ll need to submit IRS Form 3903 with your tax return. In the event that you aren’t eligible for the deduction, the IRS will require you to reverse it during your next tax return or amend the original return to recalculate the tax you owed without the deduction.

Planning on relocating at least 50 miles from your current home for a new job? Black Tie Moving is the expert Dallas moving company you can count on for five-star service. Our long-distance movers make relocating for work convenient, affordable, and hassle-free.

If you’re moving, don’t go it alone! Trust the luxury moving experts at Black Tie Moving with all of your relocation needs. We’d love to provide you with more information regarding tax deductions for moving expenses, so give us a call right away. You can also request additional information and your free, no-obligation project estimate by completing our online contact form today.

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Black Tie Moving Reviews

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Easy to communicate with when booking and confirming an appointment for furniture removal. The two movers I interacted with were friendly, helpful, and highly professional!

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