EVANSVILLE, (Ind.) - Americans who moved last year for the first time since 1994 should do some checking on allowable tax deductions. Moving expenses are no longer considered an itemized deduction, and some deductions that were allowed in the early 90s were written out of a federal tax code that took effect in 1994.
Today, domestic relocation costs can be deducted from adjusted gross income when the move meets certain requirements and the paperwork is done correctly. Knowing the tax code and how it relates to moving expenses can save hundreds or thousands of dollars. On a typical move that costs $3,500 for example, the tax savings would be $980 for those taxpayers with a 28 percent incremental tax rate.
What Came Out in '94
What Still Stands
Atlas Van Lines offers these tax guidelines:
Household goods and personal belongings - You can deduct the cost of moving your household goods and personal belongings as long as you have not already been reimbursed for these costs by your company or another entity. This reimbursement will not be includable in your income if it covers only amounts that can be deducted.
The household moving deduction includes the actual cost of transportation from your old residence to your new one, the cost of packing and crating, unpacking, storage in transit (limited to 30 consecutive days) and the cost of valuation coverage to protect your belongings during transit (limited to 30 consecutive days).
Other Deductible Items
Anyone can deduct moving expenses, even if you don't file an itemized return, as long as you meet these six qualifications:
For those planning a move in the near future, be sure to plan as far ahead as possible. Before relocating, make sure to keep receipts. Itemize any goods given to charity and keep a receipt. It may help you qualify for additional tax deductions. Deductions can be significant when using a professional mover. Before filing taxes, consult with a professional tax advisor.
For more information on deducting moving expenses, contact a tax advisor or call the IRS Problem Solving Line at 1-800-829-1040 and ask for a guide on moving expenses. Atlas Van Lines can also offer its brochure, "How to Deduct Moving From Your Taxes." Call your nearest Atlas agent to request a copy, or visit the Atlas Web site at www.atlasvanlines.com.