moving expense

[gman]

Taxpayer is fully reimbursed by employer for moving expense. It is included in his w-2 and employer has paid in
federal withholding for taxpayer. All included in w-2. Can taxpayer deduct any of those moving expenses?

[sandigi]

Yes. All of it

Taxpayer is fully reimbursed by employer for moving expense. It is included in his w-2 and employer has paid in
federal withholding for taxpayer. All included in w-2. Can taxpayer deduct any of those moving expenses?

If I am understanding your post. Employer put the fully reimbursed moving expense in box 1 of W-2 and withheld federal income tax on that reimbursed amount? So, now TP is reporting income that includes his deductible moving expense? Deduct away.

I'm only confused on one thing . . . Employer has paid in federal withholding for taxpayer?

[Gary2]

Most of the time when I see these, the employer has correctly separated the deductible from non-deductible moving expenses, so there's nothing to be taken. The deductible ones are reported by the employer in box 12 with code P, and the non-deductible ones are added to box 1, etc.

The most common exception I see is when the employer gives a standard mileage reimbursement based on an estimate of the driving miles, and the employee can document either more miles or additional tolls, etc.

[Burke]

Sometimes the employer has included all moving expenses, although you don't see that as often any more, and states don't always follow federal rules. Regardless of the amount reported, of course, the TP can only deduct what the IRS allows. But he can deduct that, at least on the federal return. This may involve two different states if the TP moved to another one. Generally, you can deduct moving expense from the one TP moved TO, but not from the one the TP moved FROM. However, you need to check both states' rules.

[gman]

Letter states

Global relocations services states in letter to taxpayer that the non qualified(taxable) moving expenses are considered income and has added these costs to your w-2 and that employer provides tax assistance to defray the additional tax liability. So can I deduct these moving expenses. Also paid for excludable moving expenses. Then provides a break down of both. Nothing on w-2 to note the moving expense. Federal, OASDI AND MEDICARE shown as tax assistance amounts- in Texas, so no state tax.

Deduct the taxable moving expense?

[gman]

also,

some of the expenses paid to employee include relocation allow and house hunt-other, bonus-av, temp living-lodging

[Gary2]

Global relocations services states in letter to taxpayer that the non qualified(taxable) moving expenses are considered income and has added these costs to your w-2 and that employer provides tax assistance to defray the additional tax liability. So can I deduct these moving expenses. Also paid for excludable moving expenses. Then provides a break down of both. Nothing on w-2 to note the moving expense. Federal, OASDI AND MEDICARE shown as tax assistance amounts- in Texas, so no state tax.

Deduct the taxable moving expense?

No. That's the whole point of the differentiation. The employer has paid all these expenses. The ones that the employee could have taken as deductions were instead omitted from box 1 income; no deduction since the employee didn't pay for them. The ones that the employee could not claim on 3903 if employee-paid were instead treated as income in box 1; no deduction because they were never eligible for deduction.

[Burke]

some of the expenses paid to employee include relocation allow and house hunt-other, bonus-av, temp living-lodging

None of those are eligible for the moving expense deduction. See Gary2's post above.