Historically, Americans have been able to deduct costs associated with moving from their taxes as long as they were relocating for work. This allowed moving Americans to eventually save money on their move, whether within state or across country, by ultimately reducing their tax burden.
Unfortunately, policies have changed rendering these write offs no longer available. The cost of moving for a new job or work location can no longer be deducted from your taxes. One notable exception, however, is for the US Armed Services.
Members of the military will still be offered this opportunity which is important to keep in mind when being stationed in a new location or choosing to begin a career in one of the five branches. Non-military personnel are out of luck, however.
Here are some relevant specifics surrounding the end of tax breaks for work-related relocations.
Is this a forever change? Will the moving write-off ever return?
The IRS has made it pretty clear that this deduction won’t be gone forever, but it is projected to be suspended until at least 2025. While this does seem like a long time to wait for its return, it’s good news nonetheless that it will be back eventually.
Similarly, if you are reimbursed for your moving expenses, you can no longer exclude this from your reported gross income for taxes during the same time period. This benefit may also be reinstated once 2026 arrives.
While these rules apply for federal taxes, this may not be the case for your respective state taxes. If you are not a member of the military, don’t forget to check your state tax laws to see if you can find some financial relief there from your work-related moving expenses. Depending on where you live and where you’re moving, you may be able to save some on the state level.
With these tax changes in mind, it’s important to consider the different ways you can make your move cheaper and more affordable on the front end. Some examples include getting your deposit(s) back, holding a yard sale for the extras you don’t need, and booking professional movers and packers as far in advance as possible.
To find professional movers to help you get the job done, call your local Kansas City relocation company, A. Arnold Movers, today!