A new job or promotion is considered a positive event in one’s life. It also often comes with significant changes one of which may be a corporate relocation. Moving is expensive and takes a lot of planning. While this can be scary, there is some good news when it comes to the prospect of uprooting your life. When making a corporate relocation, federal tax laws allow you to deduct your moving expenses. Here’s how to figure out if you qualify:

Meeting Certain Requirements

You can not deduct expenses you incur from moving within the same town. To qualify for corporate relocation moving deductions, it’s all about the distance from your old home to your new job. The requirement states that your old home must be 50 miles farther from your new job than your previous job. For example, if you traveled 10 miles from your previous home to your former employer, then your new job must be 60 miles from your old home.

The other requirement for moving deductions for corporate relocation has to do with the time you spend working. A 12-month period starts on the day you arrive, and you are required to work full-time for a minimum of 39 weeks. The IRS will defer to your industry’s standards for a full-time employee.

Expenses You Can Deduct

Once you can prove you qualify for a deduction there are a list of expenses you can cover. Everything from transportation whether it’s a flight or the cost of gas in a personal vehicle or parking fees and highway tolls. If you are moving as a family, you can also include the cost of other members.

Claiming Your Deduction

Only one of a few tax deductions you can claim early is for moving. Though you won’t be able to prove your qualification until after the 12-month period, you can apply for the deduction in the year you move. Use IRS Form 3903 to report all costs due to relocation. If you do not meet the requirements, come to the end of the 12-month period the deduction will be reversed.

To learn more about tax deductions and corporate relocations, call us today!