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What Are IRS-Approved Moving Expenses? (2025 Guide)

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Planning your move is often more complicated than it sounds. You have to deal with the logistics and packing, and you’ll also have to go through your moving expenses and create a solid moving budget. When planning their moving budget, most people assume they can get their moving expenses deducted from their annual tax bill and reduce taxable income. However, that’s not the case. Since changes have been made to the tax law in 2018, many of the moving expenses are no longer tax-deductible. In this post, we’ll guide you through tax-deductible moving costs and all the details regarding IRS-approved moving expenses, so you can enjoy significant savings on your federal tax and reduce your taxable income.

What are IRS-approved Moving Expenses?

There are a couple of basic details you should know regarding the IRS-approved moving expenses. Firstly, such costs are deductible according to strict IRS rules and can be reimbursed in specific situations. The common moving expenses deduction situation changed dramatically in 2018, when the TCJA was applied – the Tax Cuts and Jobs Act. From that moment, the moving expense deduction didn’t apply to the majority of taxpayers, but only to military families who needed to move for the job.

In general, IRS-approved moving expenses include transportation and storage of your items, as well as traveling costs to the new address.

Who is Eligible for the Moving Expense Deduction?

Wondering if you can benefit from tax deduction with your upcoming move? Then you should know exactly who is eligible. At the moment, the ones who can lower their taxes when moving are active-duty members of the Armed Forces, in case they’re moving for their job. Others, including students or remote workers, are suspended from such benefits until 2026, when the TCJA could finally expire. Still, these rules vary from state to state, and there are certain exceptions we’ll cover in the further text.

A person calculating IRS-approved moving expenses

The 50-mile Rule: What It Means

In the past, before the TCJA, the 50-mile rule was a very important detail of employee relocation planning. It was used to decide the taxability of moving costs, as you could benefit from tax deduction if your new work address is at least 50 miles farther from your previous job location. 

For example, your old home was 15 miles away from your office. To get a tax-free relocation, your new commute should be at least 65 miles (15 plus 50). When you satisfy all the IRS criteria, including the 50-mile rule, your employer could then help you with your move by paying the transportation and travel costs. But with the TCJA, such expenses are now taxable, except for the military members we mentioned before. However, with the great tax sunset coming, we should wait until 2026 and see if the old 50-mile rule will make a big comeback. 

You should also know about another requirement – the time test. This means the timing of your move must be related to the start of your new job. You should also work full-time for at least 39 weeks within the first 12 months after your move. There are exceptions here, so be sure to check this requirement with your employer.

What Is Reimbursable vs. Non-Reimbursable?

When dealing with taxes and planning a move, you should know the main difference between these two terms. Moving expense reimbursement is often offered by employers, and if you’re an active military member moving for work, such expenses may be tax-free. If that’s not the case and you’re a ‘regular employee’, such reimbursements are considered taxable income. To avoid confusion and unpleasant surprises, be sure to ask your employer about your W-2 (wage and tax statement) and if your moving costs are on the list.

Qualified vs. Non-Qualified Expenses

IRS-approved moving expenses don’t necessarily cover every penny you’ll spend on the move. This is something you should be aware of when planning your next relocation, so you can create a solid moving budget and avoid surprises.

Qualified moving expenses include:

  • Rental of the moving truck
  • Packing supplies 
  • Professional moving team
  • Gas and mileage, excluding meals 
  • Maximum 30 days of storage rental
  • Airfare and lodging during your move, excluding meals
  • The cost of shipping the employee’s car or pets to his new home
  • Insurance.

Non-qualified moving expenses include:

  • Food, drinks, snacks – all the meals you and your moving team have during the move
  • Rental costs of a temporary home 
  • Costs related to the sale of your old home, including closing fees
  • Expenses you might have during the house-hunting process – trips, meals, etc.
  • Upgrades of the new home, including buying furniture.
  • Unnecessary trips between the old and new homes.

Not sure if a certain cost can be reimbursed? Our advice is to keep all the records and receipts throughout the moving process, especially if you’re not sure if certain expenses can be tax-free. Then you can check with your tax consultant and never skip a chance to save. The employer will then have a complete list of costs they can deal with in two ways:

  • By paying all or some moving expenses directly to the provider of services
  • By reimbursing the employee after the move is finished.


Whatever the case, make sure to report all the expenses on Form W-2 and let your employer know all the details.

A person holding documents regarding IRS-approved moving expenses

Military Exception: What Service Members Can Claim

We mentioned that military service members are eligible for tax deductions when relocating. However, certain rules apply there, too. Firstly, the cause of the move should be a military order or a PCS – permanent change of station. This means your moving costs are not deductible if you decide to move on your own, even if you’re an active military member. 

Secondly, the expenses must qualify under IRS Publication 521. This means that the expenses are reasonable, most cost-effective, and include the family members who have already lived with the military member in question.

What States Still Allow Deducting Moving Costs?

As we mentioned, tax rules vary from state to state, and there are some states that allow moving expense deductions on their income tax return. With slight limitations, which you should check in detail, these states allow moving expense deductions:


If you’re moving in one of these states, make sure you check all the IRS details before you start packing.

How to Claim Moving Expenses on Your Tax Return

If you meet all the criteria and you become eligible for moving tax deductions, you can go step by step and claim moving expenses on your tax return. Here’s what you need to do:

  • Use IRS Form 3903, Moving Expenses
  • Attach it to your federal or state tax return 
  • Keep all the records, receipts, and contracts made during the move. 
  • Contact a tax professional to help you with properly claiming moving expenses.
a calculator, pen, and sticky notes used to calculate moving costs and taxes

Common Questions about Deductibility

What moving expenses are IRS-qualified?
Moving expenses such as transportation, storage, and travel can be deducted only for active-duty military members (there are certain exceptions).

Are new home improvement costs IRS-approved for deduction?
No. Home improvement expenses, as well as home sale/purchase costs, are not on the list of deductibles.

Is the 50-mile rule still applicable?
Yes – your new job must be at least 50 miles farther from your old home than your previous job was.

What has changed in the moving expenses deduction system?
Since 2017, significant changes have occurred in the way the IRS administers tax deductions. The 2017 Tax Cuts and Jobs Act took place, and since then, the majority of states no longer deduct moving costs from all employees’ taxes.

Which states still allow deductions?
Some states—including California, New York, and Massachusetts—still allow deductions if you meet prior federal criteria.

How do I claim reimbursed expenses?
If your employer reimburses you, those amounts are typically reported on your W-2. Only active military members can potentially exclude qualified reimbursements from taxable income.

Get a Moving Quote with Confidence

It can sound complicated to plan the move and get all the tax benefits, but this is only if you don’t have all the information. With the details we shared above, you’ll be able to check if you meet the criteria for such tax deductions and ensure you save as much as possible when moving in 2025. 

In case you need help planning your next move and ensuring everything goes smoothly, contact us and ensure you’ve got the most efficient team by your side.

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