Due to a merger, Allison transfers from Miami to Chicago.Under a new job description, she is reclassified from employee to independent contractor status.Her moving expenses, which are not reimbursed, are as follows: Allison's deductible moving expense is:

Question

Due to a merger, Allison transfers from Miami to Chicago.Under a new job description, she is reclassified from employee to independent contractor status.Her moving expenses, which are not reimbursed, are as follows:  Allison's deductible moving expense is:

Quizplus · Accepted Answer

As an independent contractor, Allison's move is associated with the start of a new business. Therefore, she can deduct her reasonable and necessary moving expenses related to the new job, including the cost of moving household goods and personal effects, as well as travel expenses. From the information provided, Allison's moving expenses total $5,900, which is below the maximum deduction limit of $6,100 for 2020. Hence, she can claim a deductible moving expense of $5,900.

Due to a Merger, Allison Transfers from Miami to Chicago