FAM 1994-41
FINANCIAL ADMINISTRATION MEMORANDUM NO. 94-041 (II.G.1.)
To: Bureau Assistant Directors, Administration
Director, Office of Administrative Services
Bureau Finance Officers
Chief, Division of Fiscal Services
From: Chief, Division of Financial Administration
Office of Financial Management
Subject: Reporting of Delinquent Travel Advances as Taxable
Income
Attached is a copy of a memorandum issued by the Assistant Secretary -
Policy Management and Budget and Chief Financial Officer on June 1,
1994. The memorandum provides guidance on collecting and reporting
delinquent travel advances as taxable income.
We have received inquiries regarding the applicability of this guidance
to the collection of advances issued to employees in conjunction with a
relocation. The implementing regulation issued by the Internal Revenue
Service (IRS) (Federal Register, No. 55, Monday, December 17, 1990, page
51690) specifically excludes reimbursements for moving expenses.
Therefore, advances provided for moving expenses under a permanent
change of station travel authorization are not to be reported as taxable
income. However, if the relocation travel advance is in excess of the
amount authorized in the Federal Travel Regulation for the relocation,
the excess amount must be reported as taxable income.
Advances issued to cover the cost of relocation should be settled by the
employee within 5 days after completion of each segment of the
relocation process. Thus, a voucher should be filed after completion of
the house hunting trip, the enroute travel and at the end of each 30 day
period of temporary quarters. When the relocation is delayed after the
advance has been issued, the employee should be required to repay the
advance immediately.
Action to recover relocation advances should be the same as that taken
for advances issued for temporary duty, except delinquent advances will
not be reported as taxable income. A relocation advance should be
collected form the employee's salary when the employee refuses to file
timely vouchers and/or repay the outstanding balance.
Should you have questions or require additional information on this
subject, please contact Lesley Oden of this Division on 208-6225.
Stephen J. Varholy
Attachment
Prior Financial Administration Memorandum on this Subject:
No. 91-055 (II.G.1.), July 30, 1991 - Active
