Certified Relocation Professional (CRP) Practice Exam

What does the law for 1994 and thereafter allow employees regarding moving expenses?

1. Employees to deduct moving expenses only if they itemize deductions

2. Employees to deduct moving expenses under certain income levels

3. Employees to deduct moving expenses whether or not they itemize deductions

4. Employees to deduct moving expenses only after specific thresholds are met

The correct answer is: Employees to deduct moving expenses whether or not they itemize deductions

The law regarding moving expenses allows employees to deduct moving expenses under certain conditions, particularly after the Tax Cuts and Jobs Act of 2017, which made significant changes to how moving expenses are treated for tax purposes. Prior to 2018, employees could deduct moving expenses under certain conditions regardless of whether they itemized deductions on their tax returns. This meant that deductions were accessible to a broader range of individuals, as moving expenses could be deducted even if they did not itemize. However, it is important to note that starting in 2018, most employees are no longer able to deduct moving expenses due to the suspension of the moving expense deduction for tax years 2018 through 2025, except for certain active-duty members of the Armed Forces who move due to a military order. In summary, the correct response reflects the law as it was applied before the significant tax changes made in 2017, showing that at that time, employees did enjoy the ability to deduct their moving expenses whether or not they itemized deductions.