[Code of Federal Regulations]
[Title 26, Volume 15]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR31.3401(a)(15)-1]

[Page 209-210]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 31_EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT SOURCE--Table of Contents
 
              Subpart E_Collection of Income Tax at Source
 
Sec. 31.3401(a)(15)-1  Moving expenses.

    (a) An amount paid to or on behalf of an employee after March 4, 
1964, either as an advance or a reimbusement, specifically for moving 
expenses incurred or expected to be incurred is excepted from wages, and 
hence is not subject to withholding, if (and to the extent that) at the 
time of payment it is reasonable to believe that a corresponding 
deduction is or will be allowable to the employee under section 217. The 
reasonable belief contemplated by the statute may be based upon any 
evidence reasonably sufficient to induce such belief, even though such 
evidence may be insufficient upon closer examination by the district 
director or the courts finally to establish that a deduction is 
allowable under section 217. The reasonable belief shall be based upon 
the

[[Page 210]]

application of section 217 and the regulations thereunder in Part 1 of 
this chapter (Income Tax Regulations). When used in this section, the 
term ``moving expenses'' has the same meaning as when used in section 
217. See Sec. 1.6041-2(a) in Part 1 of this chapter (Income Tax 
Regulations), relating to return of information as to payments to 
employees, and Sec. 31.6051-1(e), relating to the reporting of 
reimbursements of or payments of certain moving expenses.
    (b) Except as otherwise provided in paragraph (a) of this section, 
or in a numbered paragraph of section 3401(a), amounts paid to or on 
behalf of an employee for moving expenses constitute wages subject to 
withholding.

[T.D. 7493, 42 FR 33730, July 1, 1977]