Thinking of relocating to a new city for a better paying job? The Mintblog’s city-wise infographic has a list of 80 careers and the best and worst paying cities for the careers. If you are in a city that pays you less than the national average for that career, it’s better for you to pack up your luggage from that city and move towards the city that pays the best.
Relocation involves a lot of expenditure and you should know the expenses that you can claim and those that you can’t from your new employer. Your employer will have a policy for funding your relocation and make it a point to know them before you plan shifting. Don’t shift at your own expense first and then think of claiming the finances because you don’t know the terns and conditions of relocation payment set by your employer. To your dismay you might find that you are not satisfying the conditions for claiming the relocation funds. You are also entitled to relocation tax deductibles. You should know the conditions you should satisfy for claiming the deductions.
Any relocation by a new employee should primarily satisfy three conditions in order to be eligible for claiming moving expenses:
- You should have relocated within a year of your joining the new job. If you are relocating within the same city, your new place of residence should not be at a distance greater than your old place of residence.
- You should have worked full time for 39 weeks within the first year of shifting to the new residence. It’s not necessary that you have worked for the same employer and it is also not mandatory that you work for 39 weeks without a break. But you should have worked full time for 39 weeks after moving to the new place in a single year.
- Your new workplace should be located at least 50 miles away from your old organization for you to claim the tax deduction. If you are moving to a new city, obviously, your new workplace will in all probability be away from your old one by a distance of 50 kilometers. Also, the new workplace should be at a lesser distance than your older workplace.
The moving expenses that you could claim include your stay and transportation. But the food charges will go from your own pocket. If you think you can stop by some places of tourist interest on your way to the new city and claim the expenses, you’ll most probably be disappointed. The employers are smarter than you. They are not going to pay you for gallivanting as you wish on your way to the new place. You’ll be paid only for the shortest distance from your old place to the new place. Your employers are going to bear the costs incurred by you for transportation of your goods, not only from your old residence but also from any storage area. They are going to pay the storage fees and also pay up for transporting your car and pet(s). I think the rules are fair enough. They are going to cover most of your expenditures. Of course, you cannot take advantage of their expenses in any way.