Tax season brings the same question every year for families and businesses that moved: can any of this be written off? The honest answer is that fewer people qualify than they used to, but a few important exceptions are still worth knowing before you file.

The Short Answer: Most People Can No Longer Deduct Moving Costs

The federal moving expense deduction was suspended for most taxpayers starting with the 2018 tax year, and that suspension is set to run through 2025 under current law. If you moved for a new job, a bigger house, or to be closer to family, those costs generally aren’t deductible on your federal return anymore. This surprises a lot of people who remember claiming the deduction years ago.

Who Still Qualifies

There is one clear exception. Active-duty members of the Armed Forces who move because of a military order, such as a permanent change of station, can still deduct unreimbursed moving expenses. This includes packing, transportation, storage for up to 30 days, and travel to the new home. The move must be reported using IRS Form 3903.

Business and Self-Employed Moves

If you’re relocating a business, the picture looks different. Ordinary and necessary costs to move equipment, inventory, and office furniture are typically deductible as a business expense, separate from the personal moving expense rules. This applies whether you’re moving a storefront, an office, or a home-based business into a new space.

Self-employed people should keep this distinction in mind: costs tied to moving the business itself are treated differently than costs tied to moving your household.

If Your Employer Pays for the Move

Employer-paid relocation is another area that changed. Reimbursements are now generally treated as taxable income and reported on your W-2, rather than excluded from your pay the way they once were. If a new employer is covering your move, ask how it will appear on your tax documents so there are no surprises in April.

Check Your State Rules

This is where it gets more interesting for a lot of families. Several states never fully matched the federal changes and still allow a moving expense deduction on the state return, even though the federal deduction is gone for most people. States commonly cited as still allowing a version of the deduction include:

• Pennsylvania
• New Jersey
• New York
• California
• Massachusetts
• Arkansas
• Hawaii

Since LiteMovers serves families across Pennsylvania and moving throughout the East Coast, this matters for a lot of our customers. If you’re moving within Pennsylvania, or between Pennsylvania and one of these other states, it’s worth asking a tax preparer whether your move qualifies for a state-level deduction, since the requirements and distance tests are set by each state and can change from year to year. If you’re leaving one of these states for a state that doesn’t offer the deduction, you may still be able to claim it on a part-year resident return for the state you’re leaving.

Good Records Matter Either Way

Whether or not your move ends up deductible, it’s smart to keep a folder of moving-related paperwork: your moving estimate, final invoice, receipts for packing supplies, and any documentation of employer reimbursement. If you do qualify for a deduction, or if a future tax law change brings the deduction back, you’ll want this on hand.

• Save your moving company invoice and estimate
• Keep receipts for packing materials and supplies
• Document any employer reimbursement in writing
• Track mileage and travel costs if you drove to the new home

This article is for general information only and isn’t tax advice. Tax rules change and depend on your individual situation, so talk with a licensed tax professional before you file.

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