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To deduct moving expenses, you generally must meet certain time and distance tests. However, members of the Armed Forces who move because of a permanent change of station do not have to meet these tests.

A permanent change of station includes:

A move from home to the first post of active duty
A move from one permanent post of duty to another
A move from the last post of duty to your home or to a nearer point in the United States. The move must occur within one year of ending your active duty or within the period allowed under the Joint Travel Regulations

Reimbursements. Do not include in income the value of moving and storage services provided by the government in connection with a permanent change of station. Similarly, do not include in income amounts received as a dislocation allowance, temporary lodging expense, temporary lodging allowance, or move-in housing allowance. Generally, if the total reimbursements or allowances that you receive from the government because of the move are more than your qualified moving expenses, the excess is included in your wages on Form W-2. However, if any reimbursements or allowances (other than dislocation, temporary lodging, temporary lodging expense, or move-in housing allowances) exceed the cost of moving and the excess is not included in your Form W-2, the excess must be included in gross income on line 7 of Form 1040.

Use IRS Form 3903 to deduct qualified expenses that exceed your reimbursements and allowances (including dislocation, temporary lodging, temporary lodging expense, or move-in housing allowances that are excluded from gross income.)

If you must relocate and your spouse and dependents move to or from a different location, do not include in income reimbursements, allowances, or the value of moving and storage services provided by the government to move you and your spouse and dependents to and from the separate locations.

Do not deduct any expenses for moving services that were provided by the government, or that were reimbursed to you, that you did not include in income.

Deductible moving expenses. If you meet the requirements discussed earlier, you can deduct the reasonable unreimbursed expenses that are incurred by you and members of your household.

You can deduct expenses (if not reimbursed or furnished in kind) for the following items.

Moving household goods and personal effects, including expenses for hauling a trailer, packing, crating, in-transit storage, and insurance. You cannot deduct expenses for moving furniture or other goods you bought on the way from the old home to the new home.
Travel and lodging expenses from the old home to the new home, including automobile expenses (either actual expenses or 10 cents per mile) and air fare. You cannot deduct any expenses for meals. You cannot deduct the cost of unnecessary side trips or lavish and extravagant lodging.

You can only include the cost of storing and insuring household goods and personal effects within any period of 30 consecutive days after the day your things are moved from your former home and before they are delivered to your new home.

Member of your household. A member of your household is anyone who has both your former home and your new home as his or her main home. It does not include a tenant or employee unless you can claim that person as a dependent.

Foreign moves. A foreign move is a move from the United States or its possessions to a foreign country or from one foreign country to another foreign country. It is not a move from a foreign country to the United States or its possessions.

For a foreign move, the deductible moving expenses described earlier are expanded to include the reasonable expenses of:

Moving your household goods and personal effects to and from storage, and
Storing these items for part or all of the time the new job location remains your main job location. The new job location must be outside the United States.

Reporting moving expenses. Figure moving expense deductions on IRS Form 3903. Carry the deduction from Form 3903 to line 26, Form 1040.