If you moved for work during the tax year, it's worthwhile to look into deducting your moving expenses. The costs of moving the contents of your home an extended distance can really add up, so it could provide you with a significant deduction. Fortunately, your moving expenses deduction will not interfere with you taking the standard deduction on your taxes.
Can You Take Both Standard and Moving Deduction ?
One of the simplest ways to understand the difference between the moving deduction and the standard deduction is to review Form 1040. If you scan the first page of form 1040 you'll see "Moving Expenses" listed under the "Adjusted Gross Income" section. The standard deduction is taken on the second page of form 1040 under "Tax and Credits." These are two separate deductions, so the answer is yes, you can take both the standard and moving deductions.
Rules for Deducting Moving Expenses
Even though moving expenses don't conflict with your standard deduction, it's still important to do a check to make sure that you're eligible. In order to take the moving expense deduction, the move has to be work-related. You also have to move at least 50 miles from your original job location and work at the new location full-time for at least 39 weeks during the year. Finally, you can deduct the expenses only if you rack them up within the first year of starting your new full-time gig. The exact requirements may vary by tax year. Review Form 3903 for more information about the rules and to complete a worksheet to determine your eligibility.
Deductible Moving Expenses
Many costs associated with a move qualify for the moving expense deduction. When you rent a moving truck, a crew or storage space, that amount is deductible. If you have to pay for a hotel along the way or ship your car to the new location, you might also be able to deduct those costs. You can list the costs of shutting off or turning on your utility accounts when you move as well.
Keep in mind that you can also itemize deductions using Schedule A when listing your moving expenses instead of taking the standard deduction. Itemization is common if you owned a home and you were paying mortgage interest and property taxes at your old location (both deductible expenses on Schedule A). Be sure to choose whichever method affords you the highest deduction under "Taxes and Credits" on form 1040.