In Actor Speak
Moving expenses for an actor often do not fall within the guidelines normally used by the IRS. It is fairly rare for us to move more than 50 miles AFTER we have established a new job, let alone be fortunate to find 39 weeks of full-time work after a move (or at any time for that matter.)
Obviously it is quite common for actors to move to major production centers such as Los Angeles, New York and Chicago in search of a better opportunity to pursue their careers in general. Although this move may not fall fully within the IRS guidelines of employment, we have not learned of an actor being penalized and having their moving costs turned down by the IRS in an audit.
On the other hand moving to a location not recognized as heavily involved in the entertainment industry may not be so immediately acceptable unless it is for a full-time job or specific situations such as a singer/musician moving to Nashville.
But we must warn you, the IRS auditors have the right to make use of the existing regulations to justify their decision. The regulation presented on the opposite page states quite specifically:
"A move to another region that meets the distance test for greener pastures does not qualify unless the time test is met. There is no exception for actors or other entertainment related professions who were looking for work, but did not find it."
As always, you have the right to challenge almost any decision of the auditor but we would suggest that you discuss these issues with your tax consultant as there are numerous options to be considered under this scenario.
The below link will take you directly to the IRS website for the complete Publication they make available for reading and/or downloading.
In the Words of the IRS:
You can deduct your moving expenses if you meet all three of the following requirements.
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.
For example, if your old main job location was 3 miles from your former home, your new main job location must be at least 53 miles from that former home.
If the taxpayer is an employee, he or she must work full-time for at least 39 weeks during the first 12 months after arriving in the general area of the new job location. The taxpayer does not have to work for the same employer for the 39 weeks. However, the taxpayer must work full-time within the same general commuting area. The 39 weeks do not have to be consecutive. Whether a taxpayer is considered to be employed full-time depends on what is usual for the type of work the taxpayer does. For example, a taxpayer who does voiceover work is considered full-time at 4 hours per day.
Actors tend to not meet the 39 week test because their move deals with a short-term job, or jobs, or the hope of finding a job. Time between jobs is not counted as part of the 39 weeks, unless it is part of a scheduled break in production and the taxpayer's contract includes continuous employment before and after the break. Only if a hiatus is included per contract, will it be included as part of the required 39 weeks. A move to another region that meets the distance test for greener pastures does not qualify unless the time test is met. There is no exception for actors or other entertainment related professions who were looking for work, but did not find it.
Performers who work many short-term engagements will have to prove all of the jobs within the year together, met the 39 week test. Check the contracts to verify a "hiatus" was scheduled. The performer would be considered "seasonal."