Helen Hanks, who lives in San Francisco, California, has just been promoted to manager of a divisional


Helen Hanks, who lives in San Francisco, California, has just been promoted to manager of a divisional office. However, the divisional office is located in Portland, Oregon. Helen’s significant other, Tom Hunt, will be moving with her to Portland. Helen’s children from a previous marriage will also be joining her in Portland. The children have been living with their father in Spain for the past year. Helen easily sells the San Francisco house in which she and Tom live. Helen is the sole owner of the house. However, she has a harder time finding the right home in Portland. Helen has to make several trips to Portland before buying a house under construction. It will not be available for occupancy for at least 20 days after she arrives in Portland. Tom accompanied Helen on the house-hunting trips to give his opinion on the houses and to look for a new job. The actual move takes place as follows. The movers arrive on Wednesday to pack up Helen’s and Tom’s household items. Thursday, the movers pack up Helen’s items from a storage unit located outside the city, along with her sailboat. The movers then leave for Portland. Helen hires a college student to drive her car to Portland; the driver leaves on Friday. On Saturday, after dropping Helen at the airport for her flight to Portland, Tom leaves to drive his car to Portland via Salt Lake City, Utah, where he also visits his brother. Helen and Tom stay in a hotel from Wednesday to Friday while still in San Francisco and upon arriving in Portland until the house is ready for occupancy. The moving company stores their household items at its warehouse until Helen and Tom are ready to move into their new house. Helen’s children arrive two weeks later. In November of the current year, Helen pays for all the costs involved in selling the San Francisco home and moving Tom, the children, and herself to Portland. Helen’s employer eventually reimburses her (in March of the next year) for 75 percent of all costs of moving the household items (Helen’s and Tom’s), Helen’s car, and two house-hunting trips. The employer also reimburses Helen for 50 percent of the total hotel and meal costs while she and Tom were in Portland and waiting for the completion of their home. Advise Helen on the tax consequences of the above events.
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Federal Tax Research

ISBN: 9781285439396

10th Edition

Authors: Roby Sawyers, William Raabe, Gerald Whittenburg, Steven Gill

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