Key takeaways
What this article covers, in order:
- Who qualifies in 2025 and 2026
- What you can deduct
- How reimbursements and allowances interact
- Worked example: a 2025 PCS move from Georgia to Washington State
- Civilian moves: what changed for employers and employees
- Common mistakes to avoid
For most people, moving expenses are not deductible. Since 2018, the federal deduction has been available only to members of the Armed Forces on active duty who move under military orders because of a permanent change of station, and the One Big Beautiful Bill Act (signed July 4, 2025) made that restriction permanent. Starting with moves in 2026, the IRS says employees and new appointees of the intelligence community may also be treated like Armed Forces members for moving expense purposes.
So if you are a civilian relocating for a new job in 2025 or 2026, you cannot deduct the move on your federal return, and any relocation money your employer gives you is taxable wages. If you are in the military, or in the narrow intelligence community group, the rules below explain what you can claim on Form 3903.
Who qualifies in 2025 and 2026
Active-duty military on PCS orders
You can deduct moving expenses if you are a member of the Armed Forces on active duty and, due to a military order, you, your spouse or your dependents move because of a permanent change of station. A permanent change of station includes:
- A move from your home to your first post of duty when appointed, reappointed, reinstated or inducted.
- A move from one permanent post of duty to another.
- A move from your last post of duty to your home or to a nearer point in the United States, within 1 year of ending active duty or within the period allowed under the Joint Travel Regulations.
If a service member deserts, is imprisoned or dies, a move by the spouse or dependents to the member's place of enlistment, either person's home of record, or a nearer point in the US also counts.
Intelligence community employees, from 2026
For moves in 2026 or later, an employee or new appointee of the intelligence community (as defined in section 3 of the National Security Act of 1947), other than a member of the Armed Forces, who moves because of a change in assignment that requires relocation can be treated as a member of the Armed Forces for these rules. That covers both the deduction and the exclusion of qualifying reimbursements. It does not apply to 2025 moves.
Everyone else
Civilian employees, self-employed people and retirees cannot take the federal moving expense deduction. Some states set their own rules for state income tax, so check your state revenue department's instructions if you are moving in or out of a state with an income tax.
What you can deduct
Qualifying taxpayers deduct the reasonable unreimbursed costs of moving themselves and members of their household. A household member is someone whose main home was both the old and the new home; it does not include a nanny, maid or other employee you are not claiming as a dependent.
- Moving household goods and personal effects: packing, crating, hauling a trailer, in-transit storage, and insurance.
- Storage: storing and insuring goods within any period of 30 consecutive days after they leave your old home and before delivery to your new one. For a foreign move, storage can cover the time the new post remains your main job location.
- Travel: transportation and lodging from your old home to your new one, one trip per person, including the day you arrive. Household members do not have to travel together.
- Car costs: either your actual gas and oil, or the standard mileage rate, plus parking and tolls either way.
The mileage rate depends on when you drove
- 2025: 21 cents a mile.
- 2026, January 1 to June 30: 20.5 cents a mile.
- 2026, July 1 to December 31: 23.5 cents a mile, after the IRS raised the medical and military moving rate midyear because of higher fuel prices.
What you cannot deduct
- Meals on the trip.
- House-hunting trips and return trips to your old home.
- Costs of buying or selling a home, including closing costs, points and mortgage penalties, and any loss on the sale.
- Breaking or entering a lease, security deposits, and real estate taxes.
- Car tags and driver's licenses, refitting carpets and drapes, and home improvements to help a sale.
- Anything the government moved or stored for you, or paid for with an allowance you did not have to include in income.
How reimbursements and allowances interact
The value of moving and storage services the government provides is not income, and neither is a dislocation allowance, temporary lodging expense, temporary lodging allowance or move-in housing allowance. These excluded allowances also do not reduce your deduction on Form 3903, and are reported on your W-2 in box 12 with code P.
Other reimbursements work like an offset. If what the government paid you is less than your qualifying costs, you deduct the difference. If it paid more, the excess is generally included in your W-2 wages; if it was not, you report it yourself as income.
Worked example: a 2025 PCS move from Georgia to Washington State
Staff Sergeant Leah Ortiz received permanent change of station orders in 2025 to move from a post in Georgia to one in Washington State. The government packed and shipped most of her household goods. She drove her own car with her son.
- Mileage: 2,800 miles × $0.21 = $588.
- Lodging on the way: five nights of motels totaling $640.
- Trailer she rented herself for items the government did not ship: $450.
- Storage for 20 days while waiting for base housing: $300, inside the 30-day window.
- Total qualifying costs (Form 3903, line 3): $588 + $640 + $450 + $300 = $1,978. Her $210 of meals on the road are left out entirely.
- Reimbursements (line 4): the government paid her $900 toward travel. Her dislocation allowance is not entered here.
- Deduction (line 5): $1,978 − $900 = $1,078, carried to Schedule 1 (Form 1040), line 14, as an adjustment to income. She takes it whether or not she itemizes.
She also checks the new box on the 2025 Form 3903 certifying that she meets the requirements to claim moving expenses.
Civilian moves: what changed for employers and employees
For civilians, the One Big Beautiful Bill Act permanently ended the exclusion for qualified moving expense reimbursements. If your employer pays $8,000 toward your relocation in 2026, that $8,000 is wages subject to income tax withholding, Social Security and Medicare tax, and it appears on your W-2. Some employers "gross up" relocation payments to cover the extra tax; whether yours does is a negotiation point, not a tax rule.
If you are self-employed and moving your business, keep the personal move and the business move apart. The personal moving deduction is gone, but costs of relocating business equipment or inventory are a separate question to review with your tax preparer.
Common mistakes to avoid
- Claiming a civilian move because older articles or software prompts still mention the deduction.
- Using the wrong mileage rate for a 2026 move that straddles July 1.
- Deducting government-provided moves or expenses paid with an excluded allowance.
- Including storage beyond 30 days on a domestic move.
- Throwing away receipts for lodging and trailer rental, which you need if the deduction is questioned.
Keeping the paperwork in order
The moving deduction is a personal-return item, so there is no business ledger entry for most people. If you also run a side business, keep relocation costs out of your business books; a personal move booked as a business expense overstates your Schedule C deductions. HelloBooks' mileage tracker keeps an IRS-compliant log of business trips separately from personal driving, and its document extraction can pull dates and amounts from receipts you photograph on the road, so the records you need are in one place when your preparer asks.
This is general information about the federal moving expense deduction as of November 2026, not tax advice; check IRS Form 3903 instructions, Publication 3 or a CPA for your move.
