There is an above-the-line deduction for moving expenses to take one's first job. A common question is, does medical school-to-residency count? If so, if one missed this deduction for last year's taxes, can s/he retroactively apply for it?

Hi, Jonathan.

The following is taken from IRS Publication 521:

Moving Expenses
You can deduct your moving expenses if you meet all three of the following requirements.
• Your move is closely related to the start of work.
• You meet the distance test.
• You meet the time test.

Move Related to Start of Work.
Closely related in time. You can generally consider moving expenses incurred within 1 year from the date you first reported to work at the new location as closely related in time to the start of work. It is not necessary that you arrange to work before moving to a new location, as long as you actually go to work in that location. If you do not move within 1 year of the date you begin work, you ordinarily cannot deduct the expenses unless you can show that circumstances existed that prevented the move within that time.

Closely related in place. You can generally consider your move closely related in place to the start of work if the distance from your new home to the new job location is not more than the distance from your former home to the new job location. If your move does not meet this requirement, you may still be able to deduct moving expenses if you can show that:
• You are required to live at your new home as a condition of your employment, or
• You will spend less time or money commuting from your new home to your new job location.

Distance Test
Your move will meet the distance test if your new main job location is at least 50 miles farther from your former home than your old main job location was from your former home.

Time Test for Employees
If you are an employee, you must work full time for at least 39 weeks during the first 12 months after you arrive in the general area of your new job location (39-week test). Full-time employment depends on what is usual for your type of work in your area.

Furthermore, if you go to work full time for the first time, you are eligible to deduct qualified moving expenses. However, your place of work must be at least 50 miles from your former home to meet the distance test.

Therefore, as long as you meet the aforementioned requirements, you are eligible to deduct moving expenses on your tax return(s). If you have filed a tax return already without including this deduction, you have three years after the date you filed the original return, three years after the original filing due date or two years after the date you paid the tax (if applicable), whichever is later, to amend your tax return(s) and report the qualified moving expenses.

Zip Code: 01801

I moved from the east coast to the west coast by flying with all of the basic travel costs. I do not have the exact numbers (or even an estimate) nor the receipts.

Do you think it is worth the effort to try to recoup this tax? My marginal rate was probably around 30%. Thank you.

Hi, Jonathan.

If your marginal tax rate was 30%, then you would save roughly 30% of your moving expenses in federal taxes plus a potential % of state tax savings as well.

If you do not have receipts, do you have cancelled checks, bank statements and/or credit card statements proving you incurred these expenses? In addition, if you used a moving company, they should have proof of expense, which is sufficient back-up for your claim. The same applies to the airline, which should have a record of your expense.

You may want to look through your records to find the applicable moving expenses. Based on the information you have provided it sounds like it would be worth it.

Zip Code: 01801