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petitioner for anticipated State and Federal income taxes totaled
$21,510.98.
Warnaco, the surviving corporation, issued to petitioner,
for the year 2001, a Form W-2, Wage and Tax Statement, in the
amount of $46,519.83. The amount was itemized on a separate
schedule and included the wages paid to petitioner, including
overtime, severance pay, and a bonus. Additionally, the
$46,519.83 included $17,751.11 for moving expenses. On the
itemized schedule, Warnaco explained that the $17,751.11
consisted of $14,046.64 paid to third-party providers, less the
$3,759.87 paid for the transportation of petitioner’s personal
belongings to Irwindale, California, and the $7,464.34 paid to
petitioner as a “Total Tax Liability Gross-Up”. Thus, the
$3,759.87 paid by Authentic Fitness was not included as income on
the schedule provided to petitioner, nor was that amount included
as income on her Form W-2.
A taxpayer may claim a deduction for moving expenses paid or
incurred in connection with beginning work at a new principal
place of work. Sec. 217(a). Moving expenses include reasonable
expenses incurred in moving household goods and traveling
(including lodging) from the former residence to the new
residence. The cost of meals incurred while traveling may not be
deducted as moving expenses. Sec. 217(b). Petitioner bears the
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