Your relocation costs may be tax-deductible
For millions of Americans, relocating can be a taxing experience - literally. As the April 15 tax deadline draws nearer, the selling of a home and the costs incurred during the actual relocation take on a special significance.
''There are a number of deductions and exemptions available to homeowners and individuals who relocated last year,'' says Sidney Epstein, president of Allied Van Lines. ''If certain requirements are met and accurate records kept, the result could be a significant savings.''
According to Mr. Epstein, ''One of the most basic deductions allowed by the IRS includes the cost of packing, crating, and transporting your household goods. The cost of storing and insuring these goods for a limited period of time is also deductible.''
According to the IRS, deductions are also allowed for:
* Travel expenses, including the cost of transportation, meals, and lodging for all members of the household while traveling from the former home to the new home.
* Pre-move house-hunting expenses, including the cost of transportation, meals, and lodging.
* Costs incurred through traveling by car to the new location.
* Temporary living expenses, including the cost of meals and lodging in the area of the new job.
Before individuals can qualify for these deductions, they must meet certain requirements prescribed by the Internal Revenue Service, including:
* The new job location must be at least 35 miles farther from the relocated individual's former home than his prior job location was.
* The move must be in connection with the start of work at a new job location.
* An individual must work a minimum amount of time in the new area, specifically, 39 weeks during the 12 months immediately following the move. Self-employed individuals must work at least 39 weeks during the first 12 months and 78 weeks during the first 24 months after the move.