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Filing your taxes after a Permanent Change of Station (PCS)

It is that time of year. Tax Season. A PCS can make this time of year that much more stressful. So before you get down to the wire, brush up on these tax tips:

Form 3903

According to IRS.gov PCSs do not need to meet the distance and time tests (http://www.irs.gov/pub/irs-pdf/f3903.pdf). Moving expenses that are not reimbursed can be claimed on Form 3903. Form 3903 can also be used to deduct expenses incurred that were not covered by your government reimbursements or allowances.

Qualifying PCS Move

A qualifying PCS move includes a move from your home to your first duty location, moving from one permanent post or station to another and a move from your last post or duty station within a year of military separation, or time allowed under the Joint Federal Travel Regulations.

Military Dependents

Military dependents such as spouses and children of active duty personnel can claim moving expenses if their sponsor dies, deserts from the military, or is imprisoned. The PCS move includes a move back to the sponsor's or spouse's home of record, or the sponsor's place of enlistment or military induction.

Government Reimbursement

Do not use Form 3903 to include government reimbursements that you have received as a result of your PCS move. Government reimbursement would include the value of moving and storage fees. Also, do not include dislocation allowance, temporary lodging facility expenses or allowances, or move-in expenses, as income on the form.

General Filing Instructions

If your total reimbursements or allowances paid out from the government exceed your moving expenses to your next duty station, the extra amount will be included in your W-2 form. For expenses that exceed the cost of moving not included on Form W-2, use line 7 on Form 1040, to include these amounts.

PCS Moving Expenses

 

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Military families who PCS are entitled to deduct unreimbursed expenses such as travel costs, moving personal household goods and even the expenses incurred for hauling a trailer, packing, crating and insurance costs not covered by the military.

Military personnel are reimbursed for the majority of their expenses, plus, they also receive moving allowances to help defray the expense of moving. However, for expenses not covered, active duty members are entitled to claim PCS tax deductions on Form 3903.

Questions and How to File

If you have any questions consult a professional! MilitaryOne Source offers free H&R Block Basic Tax preparation for state and federal preparation: http://www.militaryavenue.com/Articles/Military+OneSource+Provides+Tax+Assistance+Service-41726.aspx. If your tax situation is a little more complicated and you need some one-on-one assistance you can contact your post JAG Unit (http://legalassistance.law.af.mil/content/locator.php) or find a Tax Preparer near your installation. There are many on MilitaryAvenue.com that offer a Military Discount to show their support for the military family: http://www.militaryavenue.com/RewardFinder.aspx

 

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