Support American Workers and U.S. Employers by Reinstating the Moving Expense Tax Deduction
Congress must act to support American workers and their employers by reinstating the moving expense tax deduction at the end of 2025—and your support is essential to have them do so!
Over the next several months, the U.S. Congress will engage in critical tax debates shaping the course of U.S. tax policy for years to come, including around the future of the moving expense tax deduction and exclusion. Your involvement is critical to getting Congress to act on reinstatement, which would provide critical tax relief to U.S. employees moving for employment purposes and reduce the additional associated costs faced by employers.
By allowing the moving expense tax deduction to resume, Congress can enable companies and their talent to support critical business functions, foster innovation and operational growth, and spur economic growth and job creation that will benefit communities and workers across the United States.
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Background
Each year, over 350,000 U.S. employees move within the United States as part of a formal relocation program organized by their employer. These moves, critical to the business operations, economic innovation, and talent strategies of U.S. employers large and small and the professional development of the moving employees, result in individuals and their families relocating all across the United States.
For over 50 years, individuals moving for employment purposes benefited from a provision in the U.S. tax code allowing them to deduct incurred moving-related expenses from their income taxes and to not have employer-provided moving benefits impact their taxable income calculations. In 2017, however, these benefits were suspended under the Tax Cuts and Jobs Act of 2017 for non-military employment moves through the end of 2025.
This suspension has had significant impacts on U.S. employers nationwide and on the hundreds of thousands of employees and their families moving each year, including:
- Workers moving for employment purposes are subject to approximately $1 billion annually in additional tax burden due to the suspension of the deduction.
- Workers are facing the prospect of a higher tax liability due to being classified in a higher tax bracket because moving-related benefits provided directly by their employer are being treated for tax purposes as taxable income to the employee.
- Workers are facing ineligibility for critical tax benefits, most notably the child tax credit, due to the adverse impacts of the moving expense tax suspension on taxable income levels.
- Companies are incurring billions of dollars in additional expenses annually due to having to provide additional financial support to employees to help address the additional tax burden faced because of the suspension.
Resources
Below are additional resources related to the moving expense tax deduction:
For More Information or Questions
Contact Mike Jackson, WERC’s vice president of public policy and research, or Tristan North, WERC’s government affairs adviser.