How To Deduct Business Moving Expenses

How to Deduct Business Moving Expenses
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Whether you are moving your business within your state or from state to state, you need to know what's deductible and what isn't.

Unless you're active military personnel moving for a change of station, you can no longer deduct business moving expenses. The 2017 Tax Cuts and Jobs Act, suspended the deduction for moving expenses, effective starting in the 2018 tax year.

Key Takeaways

  • Under the 2017 Tax Cuts and Jobs Act, the deduction for moving expenses has been suspended for everyone except qualified military personnel.
  • Qualifying military members can deduct certain expenses for everyone in their household.
  • If you reimburse an employee for moving expenses, you must now include that amount as a taxable part of the employee's income.
  • You are not allowed to deduct moving expenses that are not directly related to the move of your business even if you qualify as an active duty member of the military.

Who Can Deduct a Move on Their Taxes?

Even if you're an active military member, you must meet some additional requirements to qualify for this deduction. You have to have moved because of a permanent change of station, which is defined by the IRS as a move to your first post, a move between posts, or a move from your last post to your home as you end active duty.

You may also qualify for this deduction if you're a spouse or dependent of an active military member who deserts, is imprisoned, or dies and you have to move.

What Can They Deduct?

Qualified military personnel can deduct expenses of moving their household goods and the costs of travel for members of their house. Under the Tax Cuts and Jobs Act, they are also the exception and still qualify to exclude moving expenses reimbursements from their income.


For active duty military members, you can only exclude qualified moving expense reimbursements from their income if have a permanent change of station and the moving expenses would qualify as a deduction if they didn’t get a reimbursement.

Business Moving Expenses and Employees

For tax years 2018 through 2025, nonmilitary taxpayers (including any of your employees) can't deduct certain moving expenses. In addition, if you reimburse employees for moving expenses, you must include the amount of those reimbursements in the employees' wages.

What You May Not Deduct as Business Moving Expenses

Even if you still qualify, you may not deduct moving expenses that are not directly related to the move of your business, and you may not deduct personal moving expenses that do not meet the IRS distance or time test.


The IRS regulations do not allow you to take a moving expense deduction and a business expense deduction for the same expenses.

Meals are not deductible as a moving expense unless you can provide documentation that they were directly associated with the business move rather than your personal moving expenses. For example, if you followed the van carrying your business equipment to its new location and you directed the unloading, you may be able to deduct the costs associated with that trip as a regular business travel expense, including lodging and meals.

You may not deduct personal move expenses if you do not move within one year from the date you began work at the new location unless you can show that you were prevented from moving during that time.

Frequently Asked Questions (FAQs)

Are business moving expenses deductible?

No, unless you are an active member of the military moving for a permanent change of station.

What is the time test to qualify for the moving expenses?

The time test was a way to deduct personal move expenses for a self-employed person. However, unless you meet the above criteria, you still may not qualify, even if you pass the time test. The time test said you must work full-time for at least 39 weeks during the first 12 months, for a total of at least 78 weeks in the first 24 months.

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  1. IRS. "IRS Updates Guidance for Deductible Business, Charitable, Medical and Moving Expenses."

  2. IRS. "Employer Update."

  3. IRS. "Instructions for Form 3903."

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