Michael graduates from New York University and on February 1, 2017, accepts a position with a public accounting firm in Chicago. Michael is a resident of New York. In March, Michael travels to Chicago to locate a house and starts to work in June. He incurs the following expenses, none of which are reimbursed by the public accounting firm:

Automobile expense enroute

(1,000 miles at 17 cents per mile—standard mileage rate) ……………$ 170

Cost of meals en route …………………………………………………......................100

House hunting trip travel expenses ……………………………………............1,400

Moving van expenses ……………………………………………………..................3,970

Commission on the sale of

Michael’s New York condominium ……………………………………..............3,500

Points paid to acquire a mortgage on

Michael’s new residence in Chicago ……………………………………............1,000

Temporary living expenses for one week

in Chicago (hotel and $100 in meals) …………………………………................400

Temporary storage of furniture and household goods in

Chicago for 10 days until his house is ready …………………………….........500

Total expenses …………………………………………………………..................$11,040

a. What is Michael’s moving expense deduction?

b. How are the deductible expenses classified on Michael’s tax return?

c. How would your answer to Part a change if all of Michael’s expenses were reimbursed by his employer and he received a check for $11,060?