This lesson will help you determine which members of the U.S. Armed Forces are entitled to an adjustment to income for moving expenses. You will learn how to identify qualifying moves, allowances and reimbursements, and deductible moving expenses.
To determine if the taxpayer has incurred moving expenses, use the interview techniques and tools discussed in the Screening and Interviewing lesson. Although the intake and interview sheet may not list moving expenses, you will ask probing questions to find out if the taxpayer has deductible moving expenses.
To deduct moving expenses as an adjustment to income, the taxpayer generally must meet certain time and distance tests. However, members of the Armed Forces on active duty who have a permanent change of station are not required to meet these tests.
U.S. Armed Forces members receive a variety of moving reimbursements and allowances that must be considered when determining if the expenses are deductible. The travel voucher will contain much of the information needed to compute the deduction. Use Form 3903, Moving Expenses, to deduct unreimbursed moving expenses.
See Publication 521, Moving Expenses, for additional information on the topics discussed in this lesson.