On the federal tax return (Form 1040 or 1040-NR), the deduction for moving expenses is only available to active military moving due to a permanent change of station. Otherwise, complete the form if the taxpayer qualifies for a deduction on their state tax return.
Moving expenses can be deducted if the taxpayer is a member of the US Armed Forces on active duty and moved because of a permanent change of station. A permanent change of station includes the following:
- A move from the taxpayer's home to their first active duty post;
- A move from a permanent duty post to another;
- A move from the taxpayer's last duty post to their home or a closer point within the U.S. (The move must occur within 1 year of end of active duty or as allowed under the Joint Travel Regulations.)
Refer to the Form 3903 instructions or Publication 521 to determine what expenses qualify for the deduction.
If the amount of excludible moving expense reimbursements the taxpayer was paid by the government was greater than the expenses, the difference is taxable income and will be reported on their W-2 in Box 12 with code P.
To enter moving expenses in the individual income tax return in TaxSlayer Pro, from the Main Menu of the return select:
- Adjustments
- Moving Expenses for Members of Armed Forces (3903) - Select New and if prompted Taxpayer or Spouse.
- Answer YES to the question confirming the taxpayer qualifies. (Note that answering No will display the mileage entry fields, but they should only be completed if they have relevance for a state moving expense deduction.)
- Transport & Storage of Household Goods - Enter the amount paid for storage and transportation of the household goods.
- Travel Expenses - Enter the amounts paid for travel and lodging. Travel can be calculated using either actual out-of-pocket expenses for gas and oil or standard mileage, with parking fees and tolls added separately. Do not include the cost of meals nor expenses paid for by someone else.
- Amount Paid By Government for Your Move - Enter the amount the government paid towards the move, if any. This amount is indicated on Form W-2 in Box 12 with code P and isn't included in gross wages.
- Description of Move - Enter a brief description (30 characters maximum).
Note: This is a guide on entering Moving Expenses into the TaxSlayer Pro program. This is not intended as tax advice.
Additional Information:
IRS: Instructions for Form 3903, Moving Expenses