Moving Expense from PA to UT

[thetaxman2200]

Good Morning,

I read some of the moving expense post, plus my basic knowledge of moving expenses, which had now led me to ask this question.

Client moved from PA to UT. Company gave him a Bonus of $65,000 for the move. They also show a misc deduction for the 35k on his last pay stub, there is no info in box 12 and the Bonus shows up in Box 1 of the W-2 therefore it was taxable. Total moving expense for my client was about $35K which includes the normal stuff, meals, lodging, Storage etc.


thanks

Brian

[Bees Knees]

If the full $65,000 was included in taxable income on the W-2, and the tp paid $35,000 of qualified moving expenses, then take a moving expense deduction of $35,000 on the return.

[Gary2]

show a misc deduction for the 35k on his last pay stub

I know what a miscellaneous deduction on Sch. A is, but I'm not sure what you mean by a miscellaneous deduction on a pay stub. Does it just mean that the gross taxable pay is $35K more than the net pay on the check or direct deposit? That would make sense if they paid some moving expenses directly but treated it as on behalf of the employee, coming out of his pay.

Note that just because a company chose to reimburse an expense doesn't mean it's qualified on the 3903. Common examples include house hunting trips, food, and closing costs for new or previous home.

[thetaxman2200]

They paid him a bonus of 65k. It actually cost 35k for entire move, yes some of that is flights, and house hunting. I know those deduction are not allowed. However the remaining amount was for mileage, lodging, meals and storage, tolls and etc. I am assuming since he was taxed on those dollars he can deduct the true moving expenses.

Thanks

[FEDUKE404]

To clarify ...

They paid him a bonus of 65k. It actually cost 35k for entire move, yes some of that is flights, and house hunting. I know those deduction are not allowed. However the remaining amount was for mileage, lodging, meals and storage, tolls and etc. I am assuming since he was taxed on those dollars he can deduct the true moving expenses.

Thanks

Ah....you cannot deduct the cost of meals.

FWIW: The rules for deductible moving expenses are now much more severe than in olden days when you could deduct house-hunting, closing costs (buy/sell), "extra" trips, etc. none of which now can be considered for Form 3903. But on a brighter note, many employers still see these as moving expenses and (taxably) reimburse their employees for same. Hence the gist of this discussion.

FE

[ddoshan]

Can't remember the last time I seen the word olden used. Sounds and looks cool.

[thetaxman2200]

FE

Thanks for the note - questions can I deduct everything except the meals. Even though the company paid those moving expense via a bonus which should in Box 1?

[Burke]

When they include the moving expenses they paid in his W-2, he pays income tax on that amount. That means he can deduct all eligible expenses on 3903.

[Burke]

When they include the moving expenses which they paid in his W-2, he has taxable income of that entire amount. That means he can deduct all eligible expenses on 3903 based on IRS instructions. Anything in excess of those eligible expenses will remain income to him and is not excluded.

[Lion]

Moving

I've seen spreadsheets provided by companies moving employees that detail the specifically deductible items as well as the whole bulk of trips and hotels and stuff. Then, only the nondeductible amount is included in Box 1. So, if the company already paid the deductible items pre-tax, don't double dip. Employee probably has some detailed reports to show you.