Are Moving Expenses Tax Deductible in 2025? Know Who Can Claim

Wondering if moving expenses are tax deductible? If you've relocated recently, the answer has likely been "no" since 2018. The Tax Cuts and Jobs Act eliminated this deduction for most taxpayers, leaving many without this valuable tax break.

However, this tax benefit isn't gone forever. The moving expenses deduction is set to return in 2025 when the current tax law provisions expire. At that point, many taxpayers will once again qualify to deduct their moving costs when filing federal returns.

This article breaks down who can deduct moving expenses now, what qualifies as a deductible expense, and how to properly claim this deduction using IRS Form 3903. Whether you're serving in the military or planning ahead for a 2025 move, understanding these rules could save you significant money on your taxes.

Who Can Deduct Moving Expenses in 2025

The Tax Cuts and Jobs Act of 2017 suspended the moving expense deduction for most taxpayers until 2025. While this tax break remains on hold for the general public, certain groups can still claim these expenses on their tax returns.

Active-duty military under a permanent change of station

If you're a member of the Armed Forces on active duty, you can deduct moving expenses when your move results from a permanent change of station (PCS). This applies to three specific situations:

• A move from your home to your first post of active duty
• A move from one permanent post of duty to another
• A move from your last post of duty to your home or to a nearer point in the United States

For that final situation, timing matters. The move must happen within one year after ending active duty or within the period allowed under Joint Travel Regulations. The good news for military members is you don't need to worry about the time and distance tests that normally apply to moving expense deductions.

Spouses or dependents of military members under special conditions

If you're the spouse or dependent of a military member, you might qualify for moving expense deductions too. This is particularly true in difficult circumstances - if the service member deserts, is imprisoned, or dies. In these cases, a permanent change of station for you can include moves to:

• The service member's place of enlistment or induction
• Your or the service member's home of record
• A nearer point in the United States

The reality is: Sometimes the military might move you to or from a different location than the service member. When this happens, these moves are treated as a single move to your new main job location for tax purposes.

State-level exceptions for non-military taxpayers

Even though federal tax law currently limits moving expense deductions, several states still allow them on state tax returns, even for non-military taxpayers. These states include:

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

Each state sets its own rules about what qualifies. Some let you itemize moving expenses while others allow you to exclude compensation from moving-related income. Just remember: Keeping records of all your moving expenses remains important, even if you can't deduct them on your federal return right now.

When 2025 arrives, the provisions of the Tax Cuts and Jobs Act expire, unless Congress extends them. At that point, the moving expense deduction would return to previous rules, allowing more taxpayers to qualify if they meet certain time and distance requirements.

What Are Qualified Moving Expenses?

If you're an active-duty military member, knowing which expenses qualify for tax deductions can help maximize your tax benefits. Understanding what counts as a legitimate moving expense matters whether you're currently serving or planning ahead for the 2025 return of civilian moving deductions.

Transportation and lodging during the move

Qualified moving expenses include the cost of transportation from your old home to your new location. This covers expenses for you and your household members, though each person is limited to deducting only one trip. If your move requires overnight stays, lodging costs during the journey are deductible.

Just remember: Meal expenses during travel are never deductible, regardless of circumstances.

You can also deduct lodging expenses incurred within one day after you could no longer live in your former home because your furniture had been moved. This helps if you need temporary housing during transition periods.

Packing, crating, and storage (up to 30 days)

The costs of packing, crating, and transporting your household goods and personal effects qualify as deductible moving expenses. This includes expenses for hauling a trailer and insurance for your belongings during transit.

Temporary storage costs are deductible within strict parameters. You can include the cost of storing and insuring household goods for any period of 30 consecutive days after items are moved from your former home and before delivery to your new residence. Beyond this 30-day window, storage expenses are no longer considered qualified moving expenses.

Vehicle mileage, tolls, and parking fees

If you use your personal vehicle for moving, you have two options for claiming expenses:

• Actual expenses (gas and oil) with accurate records of each expense, or
• The standard mileage rate of 21 cents per mile for 2024 and 2025

In addition to these basic vehicle expenses, you can add parking fees and tolls to your deduction regardless of which method you choose.

The reality is: General maintenance, insurance, or depreciation costs for your vehicle don't qualify as deductible moving expenses. You'll need to separate these from your legitimate moving expenses when calculating your deduction.

How to Claim the Moving Expense Deduction

Ready to claim your moving expense deduction? The process requires proper documentation and filing the right forms with the IRS. Once you've determined you're eligible and collected records of your qualified expenses, you'll need to follow these steps to secure your tax benefit.

Using IRS Form 3903

Form 3903 is your key to calculating this deduction. This single-page form might look simple, but completing it correctly is essential. Here's what you'll need to do:

• Enter transportation and storage costs for household goods on Line 1
• Report travel and lodging expenses (excluding meals) on Line 2
• Add these amounts on Line 3
• Enter any government reimbursements on Line 4
• Calculate your deduction by subtracting line 4 from line 3 on Line 5

Don't forget the checkbox at the top of the form. This certifies you're a member of the Armed Forces on active duty and moved because of a military order. Without checking this box, your claim may be rejected since most civilians currently don't qualify for this deduction.

Reporting reimbursements from your employer

How you handle employer reimbursements can get tricky. The treatment depends on what type of reimbursement you received:

Qualified moving expenses paid directly to third parties by your employer don't show up on your W-2 form at all. The same goes for services your employer provides in-kind.

If your employer paid qualified moving expense reimbursements directly to you, these should appear in Box 13 of your W-2 with Code P. You must report these amounts on Line 4 of Form 3903.

Just remember: Reimbursements for non-qualified moving expenses must be included in Box 1 of your W-2 as taxable wages. This applies whether they were paid to you or a third party. These reimbursements are subject to income tax withholding and payroll taxes.

Where to enter deductions on Form 1040

After completing Form 3903, you'll transfer the calculated deduction from Line 5 to your tax return as follows:

• Enter the amount on Schedule 1 (Form 1040), Line 14
• Attach Schedule 1 to your Form 1040, 1040-SR, or 1040-NR
• Attach the completed Form 3903 to your tax return

In some cases, you might not need Form 3903. For example, if you moved outside the U.S. in an earlier year and are claiming only storage fees, you can report these directly on Schedule 1, Line 14. Simply write "Storage" on the dotted line beside the amount.

Eligibility Tests You Must Meet

If you're planning to claim moving expenses when this deduction returns in 2025, you'll need to satisfy specific IRS criteria. These tests determine whether your relocation costs qualify for tax benefits. For military members who can claim this deduction now, different rules apply.

The 50-mile distance test

The distance test looks at how far your new workplace is from your old home. There are two main scenarios:

If you had a previous job, your new workplace must be at least 35 miles farther from your old home than your old workplace was (50 miles for tax years before 2018). Here's what this means: if your old job was 10 miles from your former home, your new job location needs to be at least 45 miles from that same home.

If you didn't have a previous job - maybe you're a recent graduate or returning to the workforce - your new workplace must be at least 35 miles from your former residence.

Just remember: The IRS measures distance using "the shortest of the more commonly traveled routes between two points" regardless of which route you actually took.

The 39-week time test

For employees, the time test requires you to work full-time at your new location for at least 39 weeks during the first 12 months after moving. Self-employed individuals face tougher requirements:

• You must work full-time for at least 39 weeks during the first 12 months
• You must also work full-time for at least 78 weeks total during the first 24 months

The good news is you can claim the deduction on your return before completing the time test if you expect to meet it. The reality is, if you later fail to satisfy this requirement, you'll need to either amend your previous return or report the deduction as income on your next return.

Exceptions for military and special cases

Active-duty military personnel moving under permanent change of station orders don't need to worry about the distance or time tests. This exemption recognizes the unique demands of military service.

Several exceptions exist for civilians too. The time test doesn't apply if:

• Your job ends because of disability
• You're transferred for your employer's benefit
• You're laid off or discharged (except for willful misconduct)
• You meet requirements for retirees or survivors living outside the United States
• You're filing for a deceased taxpayer

Some taxpayers face modified tests. For instance, if you're a retiree moving back to the U.S. from abroad, you only need to meet the distance test.

Conclusion

Understanding how moving expenses affect your taxes can make a big difference in your financial situation. Throughout this article, we've looked at who can claim moving expense deductions, what expenses qualify, and how to properly claim them on your tax return.

For most taxpayers, you'll need to wait until 2025 when the Tax Cuts and Jobs Act provisions expire to use this deduction. Until then, active-duty military members with permanent change of station orders remain the main beneficiaries. That said, several states still allow moving expense deductions on state tax returns, which provides some relief even if you can't claim them federally.

If you're planning a move in the future, start tracking all your qualified expenses now. Keep records of transportation costs, storage fees, and vehicle mileage. The standard mileage rate of 21 cents per mile gives you a simple way to calculate vehicle expenses without keeping detailed gas receipts. Just remember: you'll need to satisfy both the distance and time tests when the deduction returns in 2025.

Filing Form 3903 correctly with proper documentation ensures you get every deduction you're entitled to. While the process might seem a bit complex at first, the tax savings can be substantial – especially given how expensive moving can be. Whether you're a service member relocating now or a civilian planning ahead for 2025, these tax benefits can help reduce the financial burden of moving your household.

FAQs

Will moving expenses be tax deductible in 2025? Yes, moving expenses are expected to become tax deductible again in 2025 when the current provisions of the Tax Cuts and Jobs Act expire. At that time, many taxpayers may once again qualify to deduct their moving costs on federal tax returns, provided they meet certain eligibility criteria.

Who can currently claim moving expense deductions? Currently, active-duty military members can claim moving expense deductions if their relocation is due to a military order and a permanent change of station. Some states also allow moving expense deductions on state tax returns for non-military taxpayers.

What types of moving expenses are typically deductible? Qualified moving expenses generally include transportation costs for household goods, travel expenses (excluding meals) to your new home, packing and crating fees, and temporary storage costs for up to 30 days. For those using personal vehicles, a standard mileage rate can be claimed instead of actual fuel costs.

How do I claim moving expenses on my tax return? To claim moving expenses, you'll need to complete IRS Form 3903. This form is used to calculate your deduction by listing transportation, storage, and travel costs. The resulting amount is then transferred to Schedule 1 of Form 1040. Be sure to keep all receipts and documentation of your expenses.

What eligibility tests must be met to claim moving expenses? For most taxpayers (when the deduction returns in 2025), you'll need to pass the distance test and the time test. The distance test requires your new workplace to be at least 35 miles farther from your old home than your previous workplace. The time test requires you to work full-time in the new location for at least 39 weeks during the first 12 months after moving. Active-duty military members are exempt from these tests.