Can you claim moving expenses for going back to school?

Hispanic girl packing for college
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Planning to move cross-country to go back to school? This was a question recently emailed to me by David, who's planning to attend graduate school in the fall.

Taxpayers can deduct moving expenses if they relocate for work. To qualify for the deduction, the taxpayer needs to meet two tests: the time and distance tests. The distance test requires taxpayers to move at least 50 miles farther from their old home than the distance between the old home and the new place of employment.

Under the time test, taxpayers must work full-time for at least 39 weeks during the 12 months following the move. If you are married and file a joint return, either spouse can meet the work test and the expenses will still be deductible. Also, the IRS allows 12 months from the time of your move to meet this test. If the taxpayer is self-employed, they have to work full-time at least 78 weeks in the 24 months after the move.

Graduate students will be able to claim the moving expense deduction if they meet both the distance and time tests. For example, a part-time grad student might have a full-time day job, or might work full-time as an independent contractor while in school.

David, however, doesn't plan on working full-time. Instead, he'll be working part-time at the school on through a work-study program. "It seems that unless I am working full time that my Work Study employment would not allow the deduction," David commented.

And he's right. Part-time employment will not qualify him for the deduction.

Still, David has some options available to him. Once he gets situated in school, he will be able to figure out if he can manage a full-time job. Or perhaps he can start his own consulting business. He should also consider the impact of the Lifetime Learning Credit or the tuition and fees deduction on his taxes.

By estimating his taxes with the credit, he could then see if he would benefit from the moving deduction.

And just to be on the safe side, he might want to keep his moving expenses as low as possible in case he doesn't qualify for the deduction.

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