Aires Working on Capitol Hill to Protect Client Costs – At Risk – Moving Tax Credit

In a two part blog series, Aires Laura May Carmack provides detailed information related to her work on Capitol Hill with AMSA to protect relocation spending.

Earlier this month, I had the opportunity to participate in the American Moving and Storage Association (AMSA) Moving Day on Capitol Hill. This event involved AMSA members meeting with U.S. Senators and House members of Congress to discuss legislative proposals and bills affecting our industry. On September 6, I met with Pat Toomey and Bob Casey, U.S. senators from Pennsylvania, to discuss two important issues impacting the relocation industry. In this week’s blog, I’ll discuss the issues surrounding the Moving Expense Tax Deduction.

First passed into law in 1964, this long-standing tax deduction applies to all relocating employees moving more than 50 miles for a new full-time position. Historically, Congress has maintained support for this deduction because it incentivizes finding work; it is estimated to provide $8 billion in tax relief over the next 10 years. However, certain lawmakers and the President’s tax reform outline support eliminating this deduction to pay for an overall decrease in income taxes.

The goal of our meetings was to help lawmakers understand the impact of eliminating this deduction. The average household does not anticipate or save for the cost of a future relocation since relocating often occurs in response to an unpredictable life event such as a transfer, job loss, or promotion. Moving for a job is already stressful and expensive; eliminating this benefit would add an additional unnecessary burden. A few important points stressed to the senators include:

• The Moving Expense Tax Deduction primarily affects middle-class citizens, not the elite; over 75% of taxpayers claiming the deduction earn under $100,000 per year.
• The deduction helps small business growth; growing companies can claim the deduction if they pay to move a new hire.
• The deduction currently saves money for the federal government (which spent approximately $300 million to relocate employees in 2015). Removing the deduction will cost the government roughly $150 million more annually to move employees.

Our ultimate goal is to protect the Moving Expense Tax Deduction and help hard-working families succeed as their careers grow. We encourage you to contact your state senator and House of Representatives to urge them to consider the impact of these issues on U.S. citizens. Many may not be able to afford a move without the tax benefit and therefore miss an important promotion or opportunity for growth.