Tax Law (Questions About Taxes)/W2 Box 12a Item "P"

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Question
I returned from a foreign US Govt assignment in 2013.  Dept of Justice issued a W2 for relocation.  Box 1: 15652.00; Box 12a-12d: "P" 4995.00.
I entered the W2 as normal and specified the box 12a as item "P" excludable income.  However, H&R Block added the 4995.00 to my income to figure AGI whereby my taxes due went up.
How should I correctly enter this W2 please?

Answer
Dear Suruj,

H&R Block did half of the job.

With code P used on W2 they were supposed to file form 3903 (Moving Expenses) and exclude $4995 reported as "conditional" income on W2.

Without form 3903 amount under code P is not substantiated as qualified moving expenses.

Hope this helps

I.J.Zemelman, EA

Tax Law (Questions About Taxes)

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IJ Zemelman, EA MBA

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I am an IRS-authorized EA and principal of a Tax Preparation firm focusing on U.S. Expatriates. We specialize in all tax issues faced by American citizens living abroad - such as foreign earned income, tax treaties, foreign spouse, etc. Visit our website - www.TaxesForExpats.com - for more information.

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18 years professional tax experience, 12 with expatriate taxes.

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Expatriate tax information on www.TaxesForExpats.com

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MBA from Zicklin School Of Business, IRS Enrolled Agent

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