2018 Travelers

The Tax Cuts and Jobs Act of 2017 (TCJA) made most moving expenses taxable. A W-2c was issued earlier this year reflecting some of those payments.

However, 2018 Travel W-2c’s did not report the following taxable entitlements if they were paid to a third party vendor. See this info sheet for more details or keep reading below.

Third party payments are payments made to vendors for taxable moving expenses and counted as income to the traveler. They include:

              * HHG shipment                                                            * CONUS Non-Temporary storage of HHG

              * Temporary storage of HHG                                       * Shipment of Mobile Home 

If a payment was made to a third party vendor between January and October 2018, a W-2c will be issued. You will receive a notification from DFAS if a payment was made on your behalf. You will receive a Travel 2018 W-2c in December.

• If you receive a W-2c from DFAS, you will owe a tax debt to DFAS.
• Your tax debt will be for Social Security (6.2%) and Medicare (1.45%) taxes only. Those debt letters will be mailed to your home address of record by February 2020 and will include payment options.
• You may owe federal income taxes on your vendor payment. If you owe taxes, you must file an amended 2018 Tax return with the IRS.
• If eligible, you can file a Relocation Income Tax Allowance (RITA) claim for reimbursement of the income taxes paid on the vendor payment after you have filed your amended 2018 tax return(s) with the IRS and state and/or local revenue authorities.

If a payment was made to a third party vendor in November and December 2018, it will be reported as regular income on the 2019 W-2.

If eligible, you may file a Relocation Income Tax Allowance claim (RITA) immediately after filing your 2019 Income Tax return. The RITA is designed to reimburse most of the federal and state income tax paid as a result of a PCS transfer. The RITA is taxable.

Please note, you are not eligible for RITA if you are:

• A new appointee;
• Assigned under the Government Employees Training Act; or
• Returning from an overseas assignment for the purpose of separation from Government service.

Still have questions? Check out the Frequently Asked Questions section for more information.