Moving Expenses for Flight Crews 101

Pilots and flight attendants are a mobile bunch. We decide to commute. We decide not to commute. We change jobs. We change bases. So it isn't surprising that many crewmembers ask what determines whether or not they can deduct those expenses from their taxes. Moving expenses are deductible in certain circumstances. They are NOT considered with employee business expenses, and therefore do not get written off on Form 2106 like most of the other employee business expenses that airline crewmembers incur. Instead, moving expenses get calculated on Form 3903 (Titled - Moving Expenses). Form 3903 guides you through the basic process of determining whether or not you can deduct all or part of the expenses you incur during a move. The three biggest considerations (or tests) that must be met in order to be eligible to deduct moving expenses are:

1. Job location. The move must be made in conjunction with changing the location of your job. If you remain at your same job and base, and move for personal reasons then the moving expenses are not deductible. You must change your job location.

2. Distance test. The job location (domicile or tax home for flight crewmembers) must be at least 50 miles farther from your former home than you new job location (domicile). This is a little confusing, so we created an illustration to better explain it. See illustration 1.

 

Illustration 1 - Moving Expense Deduction Distance Test

Notice that the new home location has no effect on the distance test. The only considerations are the distance from your former home to the new work location and the distance from your former home to the old work location. If the difference is greater than or equal to 50 miles, then the distance test is met.

3. Time test. You must remain employed full-time for 39 weeks during the 52 week period after the move in the general area of the new job location. There is some ambiguity with the phrase “general area,” but the intent is to show that you are moving for a job-related reason, and not for other personal reasons.

There are other considerations and special circumstances that could apply, so you should reference IRS Publication 521 for more detailed information. One of the biggest considerations, of course, is that you cannot deduct expenses you are reimbursed for from your employer. Many airline contracts have moving benefits for both pilots and flight attendants, so read them carefully to make sure you are not double-dipping. On form 3903, you will be asked about reimbursements for your move. If done properly, you should find the reimbursement amount on your W-2 Box 12, Code P. As always, keep good documentation to justify your deductions and read the free information available to you from the IRS. With proper planning, it is possible to offset some of the costs associated with a job-related move, in the form of a bigger tax refund.