Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.

We reported receiving a $4,000 moving expense reimbursement from our employer in 1997 when we actually received it in 1998. This reduced our 1997 deductions by almost $4,000. Should we file an amended return to correct that mistake and get some money back? Or should we have reported it at all, or would it have been correct to have adjusted our moving expense deduction?

The moving expense reimbursement must be reported in 1998. You can choose to deduct qualified moving expenses in 1998 vs. 1997, even though you paid the expenses in 1997. A 1997 amended return is required to either 1) reverse the moving deduction, including the reimbursement in 1997, and report the deduction with the reimbursement in 1998; or 2) reverse the reimbursement only in 1997 and report the reimbursement as income in 1998. Form 3903 should be used to report the qualified moving expenses and applicable reimbursements.

Gabriel Massuda, CPA, Reznick, Fedder & Silverman The above advice is for general purposes only and is not intended as legal, accounting or tax advice.

Pub Date: 4/08/99