Logo
Logo

Why You Should Pay Attention to IRS Form 3903

  1. Figuring IRS Qualifications for Moving Deductions Post-Move
  2. Moving Expenses Only Count If It's For A New Job
  3. The "Use Tests" Requirements
  4. The Distance Test
  5. The Time Test
  6. Buying A House: Itemize Moving Expenses Away
  7. Married Filing Jointly & Selling Your Home
  8. Update Your Change of Address to the IRS
  9. These are Guidelines, Follow Most Recent IRS Form 3903

1. Figuring IRS Qualifications for Moving Deductions Post-Move

When it comes to dealing with the IRS, filing your taxes and figuring out what you can write off may seem like the ultimate chore. On the other hand, if you know what kinds of expenses that are legitimate to deduct the process can be much easier. Moving is an expensive process whether your staying local in your state or moving interstate. Just hiring a moving company, driving, packing, eating, paying for gas or flights, etc. can be overwhelming for your bank account.

The IRS seems to understand this too, so they are pretty lenient with their basic IRS Form 3903. They also seem to know how tedious and precise you have to be in order to receive any deductions for your typical moving expenses (unless otherwise defined). There are so many employee, corporate, and office relocations happening every day that should be informed about possible deductions.

2. Moving Expenses Only Count If It's For A New job 

If you have to or choose to move because of your job, more specifically your workplace, you may be able to save in the long run. These moves are considered moving expenses by the IRS, but there are strict requirements. If you got a new job, are self-employed and relocate, or an employee that went through a relocation you may be eligible. First, you must meet the IRS Use Tests which are simply 2 tests of time and distance. These are really only to see if you've really moved because of your job's location. 

3. The "Use Tests" Requirements

While it's true that you that you can actually save money on your recent relocation, it is not to an extent of the IRS paying for a moving company for example. It's still worth trying to make back some of that extra money on that budgeted move. It's especially worth it if you had some unexpected financial surprises during the moving process.

However, it requires you to pass two test before you qualify for deductions on your moving expenses. These 2 tests are meant to test whether or not you really deserve to be reimbursed (if not by an employer or self) for moving due to a new workplace.

Essentially what they are trying to see is if you stick around in the area for a year and maintain a job, typically these tests show the IRS that you allowed moving expenses.


4. The Distance Test

  • For instance, if you moved to pursue a new workplace, it must be at least 50 miles farther from your old home than your old job was. This means that if you worked 5 miles from home before, now your new workplace must be 55 miles from your new home.
  • If no prior job, then they default to 50 miles automatically.
  • The concept is that the distance between your new home and workplace are at least 50 miles farther than your last home and workplace. The two points always have to be shortest of most commuting.

5. The Time Test

  • If you moved due to an office relocation, as an employee, you’re still required to work full time in your work’s prevailing or surrounding location for AT LEAST 39 weeks during the 12 months following your move.
  • If you’re self-employed, you must work full time in your new workplaces general area for at least 39 of those weeks and they MUST be during the FIRST 78 weeks of the 24 months.
  • This basically means they want you to stay in the local area you moved to as a way to prove it your moving expenses were really used for work-related reasoning.

6. Buying a House: Itemize Moving Expenses Away

Most people find that if you have recently bought a house and are celebrating newfound ownership, you can also celebrate the ease of itemizing any deductions. If you’ve always been a homeowner, then this part is easy. Even if you’ve accrued real estate taxes through mortgages, these real estate taxes can both be deducted from your taxes if you itemize.


This is a huge selling point to most couples or partners looking to buy. Other general expenses can be itemized even though they vary in type and range. Everything from charity donations to medical costs. It’s as easy as a little organizational effort.

7. Married Filing Jointly & Selling Your Home 

Selling your home may or may not be a qualifying option for either you or your spouse. Regardless, if you and/or your spouse pass the Use Tests (Time/Distance), either of you may be entitled to exclusion of up to $250,000 ($500,000 if married filed jointly) on your federal taxes.

  • Typically the exclusion rule applies if you sell and move out of your MAIN home every two or so years. There are requirements you must meet in order for any reductions.
  • You must be the homeowner of the main home for a minimum of 2 of the 5 years prior to owner or spouse (if applied). Secondly, you must not have benefitted financially (or gained) by excluding up to $250,000 of federal taxes on any prior house you owned during the two years before your most recent one, or the one you’re in the process of.
  • By filing taxes jointly as a married couple the same year of selling, you will meet the IRS requirements for moving expense deductions. Remember, BOTH you and your spouse would need to meet both requirements in order to qualify for the $500,000 tax deduction maximum.
  • If you and your spouse are not able to meet the ownership and use tests, you might still meet the necessary guidelines due to your work, health problems, or the 'unforeseen'.
  • Unforeseen is a very vague and general word to describe events that can range from charitable to natural disasters. Something to look up if you filed married jointly with the IRS.

8. Update Your Change of Address to the IRS

When you made your most recent move make sure not to forget about updating the U.S. Postal Office. This way your address will forward to the IRS and notify them to send any tax refunds or communicate with you directly. When determining if you can write off some of your recent moving expenses, this can be the most important part of the process. 

Don't shy away from open communication or correspondance with the IRS because they may need additional information or vice versa. It also will let your employers know about any address changes so that you can receive all of your W-2s at the end of the year. Remember, Without that information, you can’t save on moving expenses or any other expense for that matter. 

9. These Are Guidelines, Follow Most Recent IRS Form 3903

This was based on the 2017 IRS version of the Form 3903, however, if you find yourself with more questions refer to the most recent form or the form you most recently filed with. It will then refer you to another page in the booklet. This is publication 543 in the IRS booklet. This is yet another reason why it is critical to update your new address. It is important for you to understand how the IRS works and to be able to communicate with the IRS.

There are currently no comments

Add Comment

required

required (not published)

optional

Did You Know

Question In 1895 Karl Benz designed and built the first truck in history by using the internal combustion engine. Later that year some of Benz's trucks gave into modernization and went on to become the first bus by the Netphener. This would be the first motor bus company in history. Hardly a year later, in 1986, another internal combustion engine truck was built by a man named Gottlieb Daimler. As people began to catch on, other companies, such as Peugeot, Renault, and Bussing, also built their own versions. In 1899, the first truck in the United States was built by Autocar and was available with two optional horsepower motors, 5 or 8.

Question In many countries, driving a truck requires a special driving license. The requirements and limitations vary with each different jurisdiction.

Question “ The first original song about truck driving appeared in 1939 when Cliff Bruner and His Boys recorded Ted Daffan's "Truck Driver's Blues," a song explicitly marketed to roadside cafe owners who were installing juke boxes in record numbers to serve truckers and other motorists.” - Shane Hamilton

Question In the 20th century, the 1940 film "They Drive by Night" co-starred Humphrey Bogart. He plays an independent driver struggling to become financially stable and economically independent. This is all set during the times of the Great Depression. Yet another film was released in 1941, called "The Gang's All Here". It is a story of a trucking company that's been targeted by saboteurs.

Question In 1978 Sylvester Stallone starred in the film "F.I.S.T.". The story is loosely based on the 'Teamsters Union'. This union is a labor union which includes truck drivers as well as its then president, Jimmy Hoffa.

Question Signage of business routes varies, depending on the type of route they are derived from. Business routes paralleling U.S. and state highways usually have exactly the same shield shapes and nearly the same overall appearance as the routes they parallel, with a rectangular plate reading "BUSINESS" placed above the shield (either supplementing or replacing the directional plate, depending on the preference of the road agency). In order to better identify and differentiate alternate routes from the routes they parallel, some states such as Maryland are beginning to use green shields for business routes off U.S. highways. In addition, Maryland uses a green shield for business routes off state highways with the word "BUSINESS" in place of "MARYLAND" is used for a state route.

Question

In the United States, commercial truck classification is fixed by each vehicle's gross vehicle weight rating (GVWR). There are 8 commercial truck classes, ranging between 1 and 8. Trucks are also classified in a more broad way by the DOT's Federal Highway Administration (FHWA). The FHWA groups them together, determining classes 1-3 as light duty, 4-6 as medium duty, and 7-8 as heavy duty. The United States Environmental Protection Agency has its own separate system of emission classifications for commercial trucks. Similarly, the United States Census Bureau had assigned classifications of its own in its now-discontinued Vehicle Inventory and Use Survey (TIUS, formerly known as the Truck Inventory and Use Survey).

Question The Federal Motor Carrier Safety Administration (FMCSA) is an agency within the United States Department of Transportation. The purpose of the FMCSA is to regulate safety within the trucking and moving industry in the United States. The FMCSA enforces safety precautions that reduce crashes, injuries, and fatalities involving large trucks and buses.

Question DOT officers of each state are generally in charge of the enforcement of the Hours of Service (HOS). These are sometimes checked when CMVs pass through weigh stations. Drivers found to be in violation of the HOS can be forced to stop driving for a certain period of time. This, in turn, may negatively affect the motor carrier's safety rating. Requests to change the HOS are a source of debate. Unfortunately, many surveys indicate drivers routinely get away with violating the HOS. Such facts have started yet another debate on whether motor carriers should be required to us EOBRs in their vehicles. Relying on paper-based log books does not always seem to enforce the HOS law put in place for the safety of everyone.

Question

As the American Interstate Highway System began to expand in the 1950's, the trucking industry began to take over a large market share. That is, a large share of the transportation of goods throughout the country. Before this era, trains had been relied on to transport the bulk of the goods cross country or state to state. The Interstate Highway System was influential as it allows for merchandise to travel door to door with ease. Since then, truckload carriers have taken advantage of the interstate system, especially when performing a long distance move. Typically, they bring the merchandise from one distribution center of the country to another part of the country. The increase in truckload freight transportation has reduced the time it takes to transport the goods. Whether the freight was manufactured or produced for the different areas internationally, the time it takes to transport goods has decreased dramatically.
 

Question The word cargo is in reference to particular goods that are generally used for commercial gain. Cargo transportation is generally meant to mean by ship, boat, or plane. However, the term now applies to all types of freight, now including goods carried by train, van, or truck. This term is now used in the case of goods in the cold-chain, as perishable inventory is always cargo in transport towards its final homeEven when it is held in climate-controlled facilities, it is important to remember perishable goods or inventory have a short life.

Question The American Association of State Highway Officials (AASHO) was organized and founded on December 12, 1914. On November 13, 1973, the name was altered to the American Association of State Highway and Transportation Officials. This slight change in name reflects a broadened scope of attention towards all modes of transportation. Despite the implications of the name change, most of the activities it is involved in still gravitate towards highways.

Question

Although there are exceptions, city routes are interestingly most often found in the Midwestern area of the United States. Though they essentially serve the same purpose as business routes, they are different. They feature "CITY" signs as opposed to "BUSINESS" signs above or below route shields. Many of these city routes are becoming irrelevant for today's transportation. Due to this, they are being eliminated in favor of the business route designation.

Question The 1980s were full of happening things, but in 1982 a Southern California truck driver gained short-lived fame. His name was Larry Walters, also known as "Lawn Chair Larry", for pulling a crazy stunt. He ascended to a height of 16,000 feet (4,900 m) by attaching helium balloons to a lawn chair, hence the name. Walters claims he only intended to remain floating near the ground and was shocked when his chair shot up at a rate of 1,000 feet (300 m) per minute. The inspiration for such a stunt Walters claims his poor eyesight for ruining his dreams to become an Air Force pilot.

Question

The year of 1977 marked the release of the infamous Smokey and the Bandit. It went on to be the third highest grossing film that year, following tough competitors like Star Wars and Close Encounters of the Third Kind. Burt Reynolds plays the protagonist, or "The Bandit", who escorts "The Snowman" in order to deliver bootleg beer. Reynolds once stated he envisioned trucking as a "hedonistic joyride entirely devoid from economic reality"
 
Another action film in 1977 also focused on truck drivers, as was the trend it seems. Breaker! Breaker! starring infamous Chuck Norris also focused on truck drivers. They were also displaying movie posters with the catch phrase "... he's got a CB radio and a hundred friends who just might get mad!"

Question The Federal-Aid Highway Amendments of 1974 established a federal maximum gross vehicle weight of 80,000 pounds (36,000 kg). It also introduced a sliding scale of truck weight-to-length ratios based on the bridge formula. Although, they did not establish a federal minimum weight limit. By failing to establish a federal regulation, six contiguous in the Mississippi Valley rebelled. Becoming known as the "barrier state", they refused to increase their Interstate weight limits to 80,000 pounds. Due to this, the trucking industry faced a barrier to efficient cross-country interstate commerce.

Question 1941 was a tough era to live through. Yet, President Roosevelt appointed a special committee to explore the idea of a "national inter-regional highway" system. Unfortunately, the committee's progress came to a halt with the rise of the World War II. After the war was over, the Federal-Aid Highway Act of 1944 authorized the designation of what are not termed 'Interstate Highways'. However, he did not include any funding program to build such highways. With limited resources came limited progress until President Dwight D. Eisenhower came along in 1954. He renewed interest in the 1954 plan. Although, this began and long and bitter debate between various interests. Generally, the opposing sides were considering where such funding would come from such as rail, truck, tire, oil, and farm groups. All who would overpay for the new highways and how.

Question Some trailers can be towed by an accessible pickup truck or van, which generally need no special permit beyond a regular license. Such examples would be enclosed toy trailers and motorcycle trailers. Specialized trailers like an open-air motorcycle trailer and bicycle trailers are accessible. Some trailers are much more accessible to small automobiles, as are some simple trailers pulled by a drawbar and riding on a single set of axles. Other trailers also have a variety, such as a utility trailer, travel trailers or campers, etc. to allow for varying sizes of tow vehicles.

Question Driver's licensing has coincided throughout the European Union in order to for the complex rules to all member states. Driving a vehicle weighing more than 7.5 tons (16,535 lb) for commercial purposes requires a certain license. This specialist licence type varies depending on the use of the vehicle and number of seat. Licences first acquired after 1997, the weight was reduced to 3,500 kilograms (7,716 lb), not including trailers.

Question Light trucks are classified this way because they are car-sized, yet in the U.S. they can be no more than 6,300 kg (13,900 lb). These are used by not only used by individuals but also businesses as well. In the UK they may not weigh more than 3,500 kg (7,700 lb) and are authorized to drive with a driving license for cars. Pickup trucks, popular in North America, are most seen in North America and some regions of Latin America, Asia, and Africa. Although Europe doesn't seem to follow this trend, where the size of the commercial vehicle is most often made as vans.