Key takeaways:
Most Americans can’t deduct moving expenses on their federal tax return anymore
But some states still offer moving expense deductions for key expenses.
If you’re eligible to deduct moving expenses, keep your receipts to document your expenses.
I just accepted my first “real” job. The offer letter’s signed, my parents are proud, and I’m scrolling apartment listings in a city I’ve never lived in before.
Then the costs start stacking up: security deposit, movers, truck rentals, gas, maybe a hotel if I can’t finish everything in a day. Somewhere between packing tape and change-of-address forms, I start wondering — at least I can write this off on my taxes… right?
So, what can you deduct when you move?
For most people, moving expenses are not deductible on your federal tax return. The federal moving expense deduction was eliminated for non-military taxpayers under the 2017 Tax Cuts and Jobs Act and remains unavailable under the One Big Beautiful Bill.
There is one exception. If you’re actively serving in the military or you’re part of the Intelligence Community, you might be eligible to deduct certain moving expenses on your federal tax return when the move is related to a permanent change of station (PCS) or active duty.
Even if you don’t qualify at the federal level, some states — including California and Hawaii — still offer moving expense deductions. State rules vary, so it’s important to check your state’s government website.
I’m eligible to deduct moving expenses. Now what?
First of all, woohoo. Any chance to keep more of your money is a win. If your move qualifies, the most important thing you can do is store your receipts and other documentation to support the deduction when you file.
Keep track of key expenses associated with your move, including:
Gas or mileage on your vehicle
Rental trucks
Labor costs (e.g. movers, packers)
Short-term storage
Packing supplies
FYI: Meals during your move aren’t deductible — so that first pizza in your new place is on you.
One tip to make this easier: decide how you’ll store and organize receipts before you pack. Having a simple system in place can save you time (and stress) when it’s time to file.
Anything else I need to know?
Even if you can’t deduct moving expenses on your federal return, your employer may offer benefits that help offset the cost of your move. It’s worth checking whether your employee benefits include reimbursement, signing bonus, or a relocation bonus.
Keep in mind: relocation bonuses are often taxed as supplemental income, which means your employer may withhold a higher percentage upfront. And if your employer covers some moving costs, you generally can’t claim those same expenses on your tax return.
Rules vary by state, so it’s a good idea to confirm how your state handles these situations.
We’re here to help you as you launch your career
Thinking about taxes now, while you’re starting your first job, puts you ahead of the curve. Big milestones like moving, changing jobs, or earning a bonus can all affect your taxes in different ways.
Just started your career? See how major life changes affect your taxes with our Life Events Calculator.
