Relocation and rent tax deduction? (F1/H1B)

rogerme · Post by **rogerme** » Mon Dec 19, 2011 9:33 pm

Hello,

I spoke with a co-worker and she mentioned that Relocation Allowances given at the beginning of employment is tax exempt? (I am currently on F1/H1B) if it makes any difference.

Furthermore, I was told that rent and living expenses while I am on F1 visa are also tax deductible?

Thanks in advance for your help.

nelsona · Post by **nelsona** » Mon Dec 19, 2011 10:37 pm

Neither is true.

rogerme · Post by **rogerme** » Sat Dec 24, 2011 12:15 pm

How come?

http://www.askmehelpdesk.com/taxes/f1-i ... 20218.html

nelsona · Post by **nelsona** » Sat Dec 24, 2011 4:21 pm

It is not tax exempt. It is tax deductible if included in income.

nelsona · Post by **nelsona** » Sat Dec 24, 2011 4:22 pm

Relo expenses, that is.

Rent etc are not deductible

rogerme · Post by **rogerme** » Sat Dec 24, 2011 10:18 pm

OK. So if I received a $10,000 relocation bonus, do i have to pay tax on that?

nelsona · Post by **nelsona** » Sun Dec 25, 2011 1:11 am

Yes. And then you deduct eligible moving expenses.

rogerme · Post by **rogerme** » Tue Dec 27, 2011 10:58 pm

I see. OK thanks!

How exactly do I deduct moving expenses? Flights, etc? Do I need to keep all receipts?

nelsona · Post by **nelsona** » Wed Dec 28, 2011 3:34 am

Eligible moving expenses are:

1 trip TO your new place of work for each family member, including lodging along the way, and cost of transporting your household goods.

See IRS Pub 521 and Form 4782.

Any tax software will handle this easily

rogerme · Post by **rogerme** » Wed Dec 28, 2011 11:13 pm

Great. Thank you!