Moving Expense Employer Reimbursement

[RightOn]

Taxpayer moved to a new location for a new job in 2014. His new employer paid him $2,000 for the moving expenses.

I understand the reimbursement could be either under an accountable plan (not taxable) or an non-accountable plan (taxable).

If it is under an accountable plan, the reimbursement would be excluded from income. So nothing is reported on Form W-2.

If it is under an non-accountable plan, it is reported on Form W-2, box 12, code P.

So can we safely conclude that, if the reimbursement amount does not appear in box 12, it was made under an accountable plan so it is not taxable?

[Gary2]

Taxpayer moved to a new location for a new job in 2014. His new employer paid him $2,000 for the moving expenses.

I understand the reimbursement could be either under an accountable plan (not taxable) or an non-accountable plan (taxable).

If it is under an accountable plan, the reimbursement would be excluded from income. So nothing will be reported on Form W-2.

If it is under an non-accountable plan, it will be reported on Form W-2, box 12, code P.

So can we assume that if the reimbursement does not appear in box 12, it was made under an accountable plan so it is not taxable?

I'm afraid this is backwards, sort-of. The W-2 instructions don't mention accountable plans with regard to moving expenses.

Rather, reimbursements for expenses believed to be qualified are in Box 12, code P. Reimbursements for expenses not known to be qualified are in boxes 1, 3, and 5, along with payments directly to vendors for non-qualifying expenses. Payments directly to the vendor for qualifying expenses don't appear on the W-2 at all.

So, effectively, if nothing appears in box 12, you can assume that it was added to income, and the taxpayer may deduct any qualifying expenses he paid. If something does appear in box 12, code P, that amount must be subtracted from any qualifying expenses to determine the amount that can be deducted, and in rare cases, a code P amount must be added to line 7 (if the employer reimbursed more than the taxpayer actually paid).

[RightOn]

I'm afraid this is backwards, sort-of. The W-2 instructions don't mention accountable plans with regard to moving expenses.

Rather, reimbursements for expenses believed to be qualified are in Box 12, code P. Reimbursements for expenses not known to be qualified are in boxes 1, 3, and 5, along with payments directly to vendors for non-qualifying expenses. Payments directly to the vendor for qualifying expenses don't appear on the W-2 at all.

So, effectively, if nothing appears in box 12, you can assume that it was added to income, and the taxpayer may deduct any qualifying expenses he paid. If something does appear in box 12, code P, that amount must be subtracted from any qualifying expenses to determine the amount that can be deducted, and in rare cases, a code P amount must be added to line 7 (if the employer reimbursed more than the taxpayer actually paid).

Yes, I had it backwards when I typed out the question. But I have found the answer in your reply. Thank you.