Claiming Your Moving Expenses on Your Tax Return
Posted on June 9, 2009
Filed Under Apartment Living | 18 Comments
If you’re renting an apartment, you probably know that a portion of your apartment rent can be deducted from your taxes. However, you might not know that you can also deduct certain moving expenses from your next tax return, including transportation, packing and storage costs.
You Can Deduct Moving Expenses If …
To be able to claim moving expenses from your taxes, your move has to fit in one of the following categories:
· You moved to your new home or new apartment to start a job or a business, or to attend full-time post-secondary courses at a university, college or other educational institution.
· Your new place of residence is at least 40 kilometres closer to your workplace or school than your previous home.
· You moved from one place in Canada to another place in Canada.
Eligible Moving Expenses:
The Canada Revenue Agency allows you to deduct reasonable amounts that you paid for moving yourself, your family and your household effects, including:
· Transportation costs associated with moving from your old residence to your new one (e.g., gas, meals, and accommodation).
· Transportation and storage costs for your household effects (e.g., packing, hauling, storage and insurance).
· The cost of revising your legal documents and driver’s license to reflect the address change,
· The costs associated with disconnecting and switching over your utility hookups (e.g., cable, Internet, phone, hydro and gas).
· A maximum of 15 days’ living expenses near new or old residence (e.g., hotels and meals).
· The cost of cancelling your old lease.
· The cost of selling your old residence (including advertising, notary or legal fees, real estate commissions and mortgage penalties).
· If applicable, the costs associated with maintaining heat and power in a vacant old residence.
Expenses That Are Not Deductible:
Although the list above covers many of the costs associated with moving to a new apartment, there are many expenses that are not deductible (including some that are similar in nature to those that can be claimed). These include:
· A loss on the sale of your previous home.
· Expenses for work done to make your previous home more saleable.
· Transportation expenses for house-hunting trips before your move.
· Mail-forwarding costs.
· Expenses to replace items such as drapes, carpets and toolsheds.
Be sure to keep all of your receipts and documents supporting your claims – even if it’s not necessary to send them with your tax return, the CRA may want to see them at a later date.
Please keep in mind that the information presented in this article is very general and is subject to change, as tax laws are modified on a frequent basis. For specific details about which moving expenses you can claim, the maximum amount you can claim and the forms you will need to make your claim, be sure to check out the Canada Revenue Agency’s website or meet with a professional accountant.
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18 Responses to “Claiming Your Moving Expenses on Your Tax Return”
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Just curious have you been able to save while living in Japan? I know some people go abroad to teach so that they can either save money to payoff loans or pay for graduate school.
i’ve enjoyed your videos and they are very interesting
Yes, you have to be a factual cdn resident or deemed cdn resident before you can claim the moving expenses TO Canada. Please see below for a detailed discussion:
You can deduct eligible moving expenses from employment or self-employment income you earn at your new location if you move and establish a new home to be employed or carry on a business.
Generally, your move must be from one place in Canada to another place in Canada.
http://www.cra-arc.gc.ca/tax/individuals/topics/income-tax/return/completing/deductions/lines206-236/219/who-e.html
Provided you met all other conditions and requirements, you can claim eligible expenses for a move to Canada if you are a full-time student (including a co-operative student) or a factual or deemed resident.
Factual residents
You may be a factual resident of Canada for tax purposes if you keep residential ties with Canada while living abroad.
·The term factual resident means that although you're not in Canada, you're still considered a resident of Canada for income tax purposes.
If you also establish residential ties in a country with which Canada has a tax treaty and you're considered to be a resident of that country for the purposes of the tax treaty, you may be considered a deemed non-resident of Canada for tax purposes.
Deemed residents
You may be a deemed resident of Canada for tax purposes if you've severed residential ties with Canada and you're a:
·member of the Canadian Forces at any time in the tax year;
·member of the Canadian Forces overseas school staff and you choose to file an income tax return as a deemed resident of Canada (if you left Canada during the tax year, please read the section for overseas school staff);
·federal or provincial government employee, and you either lived in Canada just before being posted abroad or you received a representation allowance during the tax year;
·person working under a Canadian International Development Agency (CIDA) assistance program and you were a resident of Canada at any time during the three-month period just before you began your duties abroad;
·dependent child of someone who falls into one of the categories described above and your net income in 2007 was not more than $9,600 ($8,839 in 2006, $8,648 in 2005; $8,012 in 2004; $7,756 in 2003; $7,634 in 2002; $7,412 in 2001; $7,231 for 2000);
·person who, under a tax treaty, is exempt from tax in your new country of residence on 90% or more of your income from all sources because of your relationship to a resident — including a deemed resident — of Canada.
http://www.cra-arc.gc.ca/tax/nonresidents/individuals/govt_empl-e.html#factual
ADDITIONAL COMMENTS RE YOUR ADDITIONAL QUESTION.
It appears that u may claim the moving expenses on your US tax return, as the IRS taxes based on US citizenship while Canada taxes based on residency. In other words, as a US citizen, you be liable to pay US taxes after moving to Canada, and therefore you may be eligible to claim the moving expenses to a job in Canada. Pls see reference below:
To deduct allowable expenses for a move outside the United States, you must be a United States citizen or resident alien who moves to the area of a new place of work outside the United States and its possessions. You must meet the requirements under Who Can Deduct Moving Expenses, which states in summary: You can deduct your allowable moving expenses if your move is closely related to the start of work. You also must meet the distance test and the time test.
Deductible expenses. If your move is to a location outside the United States and its possessions, you can deduct the following expenses.
·The cost of moving household goods and personal effects from your former home to your new home.
·The cost of traveling (including lodging) from your former home to your new home.
·The cost of moving household goods and personal effects to and from storage.
·The cost of storing household goods and personal effects while you are at the new job location.
http://www.unclefed.com/IRS-Forms/2001/HTML/p52102.html
http://www.unclefed.com/TaxHelpArchives/1999/HTML/pub521/p521.html
Assuming that you qualify (Your new home must be at least 40 kilometers closer to the new place of work) then yes, mortgage penalty is an eligible moving expense.
How much you get back depends on what tax bracket you are in, but it would be at least 20% of the total moving expenses.
you look pretty in this vid
moving expense is an itemized deduction and not a refundable credit.
see IRS.gov and use their search mechanism for fuller details — if you itemize.
Sorry I can't answer this for you, but it sounds like you would have some possible deductions. It would probably be worth your time and money to hire a professional. Also, if they do it incorrectly, they are liable for taxes and penalties, not you in most cases. Ask about their guarantees.
45 mins a month did i hear that right? what do people only text?
who braids your hair in japan?
I like your sweater : D
these are not itemized deductions.. they are deductions for adjusted gross income and should be helping to reduce your income on a 1 to 1 basis (after appropriate filling out of forms)..
If you are using a particular tax program, this could be the problem.. You may need to work this out manually.. Hope that helps.
Mouse urinating on cotton…LOL
So Grand Fuji is the Japanese Walmart
i like your sweater too, nice vid.