H1-B visa transfers

[joanmcq]

I know the attorney fees, etc to obtain an H1-B visa are not deductible employee biz expenses, but what about fees to transfer an existing visa from one company to another? Client got married and moved to be with husband and had to move from Bay Area to LA, and get a new job. Could the fees be considered job search and not fees to enter a profession?

[bertrans]

H-1B Visa

Client didn't incur the visa fee whilst searching for the new job. Still not deductible as EBE.

[Luis Mopeo]

Client didn't incur the visa fee whilst searching for the new job. Still not deductible as EBE.

I'm not sure that's correct.

I'd be surprised if you'd find this specific situation spelled out in any regs, rulings, etc., so you have to find the closest thing you can and compare the rules.

Take a CPA for example. The costs incurred with initial licensing as a CPA are not deductible because it's a new trade or business. However, if you get your CPA license in one state and start practicing, then want to become licensed in another state, the new costs are deductible, because it's no longer a new trade or business.

I know a work visa isn't exactly the same as a professional license. However, I wouldn't be so quick to throw out the deduction. Especially if it's in the same trade or business, I vote deductible. Even if it's not in the same trade or business, I vote gray area and recommend that the client take the chance and deduct it.

[joanmcq]

they are being audited

They already took the deduction. I'm trying to find out if I can defend the deduction in audit. Most of my coworkers are saying no, but I'm trying to find justification in that it is a transfer, not the initial visa.

[bertrans]

H1-B Visa

I agree with you that finding a similar case and making the point based on that case may be the way to go. You say the return is under audit: the agent will probably take the 'ordinary and necessary' approach. A visa fee is certainly necessary, but the agent will argue that it is not ordinary, since most employees in the particular area do not incur such a fee.
As for the argument that it is a tranfer cost, frankly I just don't know if that will fly - it might. You're right that, to win your position, the fee will have to be recategorised as tranfer and not visa. Good luck.