How and When To Report(p11)

This section explains how and when to report your moving expenses and any reimbursements or allowances you received for your move. For a quick overview, see Table 2, later.

Use Form 3903 to figure your moving expense deduction. Use a separate Form 3903 for each move for which you are deducting expenses.

Do not file Form 3903 if all of the following apply.

• You moved to a location outside the United States in an earlier year.
• You are claiming only storage fees while you were away from the United States.
• Any amount your employer paid for the storage fees is included as wages in box 1 of your Form W-2.

Instead, enter the storage fees (after the reduction for the part that is allocable to excluded income) on Form 1040, line 26, and enter "Storage" on the dotted line next to the amount.

If you meet the special rules for members of the Armed Forces, see How to complete Form 3903 for members of the Armed Forces under Members of the Armed Forces, later.

Complete Worksheet 1, earlier, or the Distance Test Worksheet in the instructions for Form 3903 to see whether you meet the distance test. If so, complete lines 1 through 3 of the form using your actual expenses (except, if you use your own car, you can figure expenses based on the standard mileage rate, instead of actual amounts for gas and oil). Enter on line 4 the total amount of your moving expense reimbursement that was excluded from your wages. This excluded amount should be identified on Form W-2, box 12, with code P.

If line 3 is more than line 4, subtract line 4 from line 3 and enter the result on line 5 and on Form 1040, line 26. This is your moving expense deduction.

If line 3 is equal to or less than line 4, you have no moving expense deduction. Subtract line 3 from line 4 and, if the result is more than zero, include it as income on Form 1040, line 7.

Deduct your moving expenses on Form 1040, line 26. The amount of moving expenses you can deduct is shown on Form 3903, line 5.

You may have a choice of when to deduct your moving expenses.

If you were not reimbursed, deduct your moving expenses in the year you paid or incurred the expenses.

In December 2011, your employer transferred you to another city in the United States, where you still work. You are single and were not reimbursed for your moving expenses. In 2011, you paid for moving your furniture and deducted these expenses on your 2011 tax return. In January 2012, you paid for travel to the new city. You can deduct these additional expenses on your 2012 tax return.

If you are reimbursed for your expenses and you use the cash method of accounting, you can deduct your expenses either in the year you paid them or in the year you received the reimbursement. If you use the cash method of accounting, you can choose to deduct the expenses in the year you are reimbursed even though you paid the expenses in a different year. See Choosing when to deduct, next.

If you deduct your expenses and you receive the reimbursement in a later year, you must include the reimbursement in your income on Form 1040, line 21.

If you use the cash method of accounting, which is used by most individuals, you can choose to deduct moving expenses in the year your employer reimburses you if:

• You paid the expenses in a year before the year of reimbursement, or
• You paid the expenses in the year immediately after the year of reimbursement but by the due date, including extensions, for filing your return for the reimbursement year.

You choose to deduct moving expenses in the year you received reimbursement by taking the deduction on your return, or amended return, for that year.