Case Study 2: When to Claim the Deduction

Jamie was relocated to another Air Force base. Here's how a volunteer helped Jamie determine if he had any deductible moving expenses.

VOLUNTEER SAYS		JAMIE RESPONDS
So, you were transferred from Maxwell Air Force Base to Scott Air Force Base last year, right?		Yes, I was reimbursed $400 for travel expenses on the way to Scott Air Force Base.
Did you receive any other allowances?		Yes, I also received a $1,000 dislocation allowance
Well the reimbursements were not reported on your W-2. You can only deduct expenses that are larger than your combined reimbursements and allowances. First, let's add all your qualified expenses. How much was your travel and lodging?		I spent $575 on travel and lodging and another $200 for meals along the way.
Any other expenses?		Yes, I gave a $350 security deposit to my new landlord.
Only the travel and lodging en route can be claimed on Form 3903. The security deposit and meals are not deductible expenses. Your reimbursement and dislocation allowances add up to $1,400. Since that's more than your expenses, you don't have anything to deduct. But, you don't have to include any of the excess reimbursement as income, either.