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Moving Your IRA Money Around

IRA rules permit you to transfer, tax free, assets from other retirement plans to an IRA. The rules permit the following kinds of transfers: Transfers from one trustee to another, Rollovers, and Transfers incident to a divorce.

See Publication 590 Individual Retirement Arrangements

Passive Investments

In general, rental activities (except those meeting the exception for real estate professionals) are passive activities. Deductions for losses from passive activities are limited. You generally cannot offset income, other than passive income, with losses from passive activities. Nor can you offset taxes on income, other than passive income, with credits resulting from passive activities. Any excess loss or credit is carried forward to the next year.

See Publication 925 Passive Activity Limits

Social Security Benefits

If the only income you received during the tax year was your social security or equivalent tier 1 railroad retirement benefits, your benefits generally are not taxable and you probably do not have to file a return. If you have income in addition to your benefits, you may have to file a return even if none of your benefits are taxable. If you are married and file a joint return, you and your spouse must combine your incomes and your benefits to figure whether any of your combined benefits are taxable. Even if your spouse did not receive any benefits, you must add your spouse's income to yours to figure whether any of your benefits are taxable.

See Publication 915 Social Security and Equivalent Railroad Retirement Benefits

State and Local Income Taxes

You can deduct state and local income taxes. However, you cannot deduct state and local income taxes you pay on income that is exempt from federal income tax, unless the exempt income is interest income. Deduct state and local income taxes withheld from your salary in the year they are withheld.

If you receive a refund of state or local income taxes in a year after the year in which you paid them, you may have to include the refund in income on line 10 of Form 1040, in the year you receive it.

See Schedule A (Form 1040)

Stocks and Bonds

The basis of stocks or bonds you own generally is the purchase price plus the costs of purchase, such as commissions and recording or transfer fees. If you got stocks or bonds other than by purchase, your basis is usually determined by FMV or the donor's adjusted basis.

See Publication 550 Investment Income and Expenses

Travel (Moving Expenses)

You may be able to deduct some of your expenses for moving to a new home because you changed job locations or started a new job. You can qualify for the deduction whether you are self-employed or an employee. You can deduct your allowable moving expenses if your move is closely related to the start of work. You also must meet the distance and the time test.

Time Test - You can generally consider moving expenses incurred within one year from the date you first reported to work at the new location as closely related in time to the start of work. It is not necessary that you arrange to work before moving to a new location, as long as you actually do go to work.
Distance Test - Your move will meet the distance test if your new main job location is at least 50 miles farther from your former home than your old main job location was from your former home.

If you meet the requirements, you can deduct the reasonable expenses of

1.) Moving your household goods and personal effects and
2.) Traveling (including lodging) to your new home.

You can deduct the cost of packing, crating, and transporting your household goods and personal effects and those of the members of your household from your former home to your new home. You can 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.

You can deduct any costs of connecting or disconnecting utilities required because you are moving your household goods, appliances, or personal effects.

You can deduct the cost of shipping your car and household pets to your new home.

You can deduct the cost of moving household goods and personal effects from a place other than your former home. You deduction is limited to the amount it would have cost to move them from your former home.

You can deduct only those expenses that are reasonable for the circumstances of your move. You can deduct the cost of transportation and lodging for yourself and members of your household while traveling from your former home to your new home. This includes expenses for the day you arrive. You can include any lodging expenses you had in the area of your former home within one day after you could not live in your former home because your furniture had been moved. You can deduct expenses for only one trip to your new home for yourself and members of your household. However, all of you do do not have to travel together.

If you received an advance, allowance, or reimbursement for your allowable moving expenses, how you report this amount and your expenses depends on whether the reimbursement was paid to you under an accountable plan or a nonaccountable plan.

See Publication 521 Moving Expenses

Union Dues

Amounts deducted from your pay for union dues, assessments, contributions, or other payments to a union cannot be excluded from your gross income. You may be able to deduct some of these payments as a miscellaneous deduction subject to the 2% limit if they are related to your job and if you itemize your deductions on Schedule A (Form 1040).

See Publication 529 Miscellaneous Deductions

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