What Is Form 3903: Moving Expenses?
Form 3903 is a tax form created by the Internal Revenue Service (IRS) and used by taxpayers to deduct moving expenses related to a new job. Beginning with tax year 2018, there are new restrictions on who can file Form 3903 and take the moving expenses deduction. Moving expenses are only deductible in certain circumstances by military members.
- Taxpayers can use Form 3903 for each qualifying move in a tax year.
- Those with multiple job-related moves must fill out multiple forms.
- A taxpayer’s new employment location must be at least 50 miles further than the distance between their home and their old employer.
Who Can File Form 3903: Moving Expenses?
Form 3903 is used for each qualifying move a taxpayer makes in a tax year, which means those with multiple job-related moves must fill out multiple forms. For tax years prior to 2018, the IRS allows taxpayers to use this form to deduct other reasonable moving expenses, such as the cost of hiring professional movers or expenses related to traveling to their new home.
Qualifying expenses can include:
- The cost of boxes, tape, moving blankets, bubble wrap, and other packing necessities
- Rental fees for moving trucks and storage units
- Travel costs, including plane fare, gas or mileage, and hotel costs
- The costs of moving other family members in a separate vehicle
You can only file Form 3903 if you meet certain exceptions. First, your new job must be at least 50 miles further than the distance between your previous home and your old job. So, if your previous job was 14 miles away from your former home, your new job must be 64 miles away from your previous home. Members of the United States military can claim their moving expenses regardless of the distance or employment requirements if they are making a permanent change in their military status such as retirement or termination of service.
Second, you must move around the same time as you start your new job. The time test qualification requires filers to work at the new location for at least 39 weeks out of the 12 months following the move. If you haven’t had time to rack up 39 weeks at the new job before the filing deadline, you can still file Form 3903 if you expect to pass the time test in your first year of employment.
Self-employed individuals can also file Form 3903, but their time test is more stringent. They must work at the new job for 39 weeks in the first year after the move, and 78 weeks by the end of the second year.
A qualifying time and distance test must be completed to determine if the costs of a move can be deducted.
How to File Form 3903: Moving Expenses
You must complete a qualifying time and distance test to determine if you can deduct the costs of a move. A taxpayer’s new employment location must be at least 50 miles further than the distance between their home and their old employer. There is also a 39-week seasoning period. This means the taxpayer must be employed at the new location for at least 39 weeks out of the year. There are valid reasons for exceptions to the seasoning requirement, including but not limited to disability, transfer, or termination of employment.
There are no qualifying distance or time requirements for members of the armed forces who utilize the deductions.