Case Study 1: Calculating the Deduction
Here's how a volunteer helped Mrs. Fannin determine if she had any deductible moving expenses.
| VOLUNTEER SAYS |
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MRS. FANNIN RESPONDS |
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| You said you just moved here during June of this year. Was this a PCS move? |
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Yes, my husband was transferred here in March, shortly before he deployed. I have family close by, so I'd rather stay here while he's overseas |
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| If your expenses were more than the Armed Forces reimbursed you for, you may be able to use the difference to reduce your gross income. We'll complete Form 3903 to see how it comes out. Did you bring your travel voucher with you? |
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It's right here. We drove our own car 1,000 miles to get here, and paid $120 for gas. We paid $300 for motels and $135 for meals on the way. The military moved our household goods, and we didn't have any overweight. |
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| Did you drive directly here, or did you take any side trips? |
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We came right here so we could settle in before he deployed. |
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| The IRS will let you use the standard mileage rate for a military move. To determine the standard mileage rate, let's look at Publication 521 and multiply the rate times the number of miles. |
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Okay. |
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| The IRS allows lodging costs, but not food. So your total allowable expenses includes $300 for the motels and your mileage expenses. The travel voucher shows a total of $400 in reimbursements – did you receive any other reimbursements or allowances? |
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No, that's it. |
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| Then you'll get to deduct the amount you spent that was more than your reimbursements. |
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