41 CFR 302-17.4 - Exclusions from coverage.

§ 302-17.4 Exclusions from coverage.
The provisions of this part are not applicable to the following:
(a) Any tax liability that may result from payments by the Government to relocation companies on behalf of employees transferred on or after November 14, 1983, through October 11, 1984, other than the payments for those expenses specified in § 302-17.3(i)(1).
(b) Any tax liability incurred for local income taxes other than city income tax as a result of moving expense reimbursements for employees transferred on or after November 14, 1983, through October 11, 1984. (See definition in § 302-17.5(b).)
(c) Any tax liability resulting from reimbursed expenses for any extended storage of household goods except as specifically provided for in § 302-17.3(c).
(d) Any tax liability resulting from paid or reimbursed expenses for shipment of a privately owned automobile.
(e) Any tax liability resulting from an excess of reimbursed amounts over the actual expense paid or incurred. For instance, if an employee's reimbursement for the movement of household goods is based on the commuted rate schedule and his/her actual moving expenses are less than the reimbursement, the tax liability resulting from the difference is not covered by the RIT allowance. (See § 302-17.8(c)(2)(i).)
(f) Any tax liability resulting from an employee's decision not to deduct moving expenses for which a tax deduction is allowable under the Internal Revenue Code or appropriate State and local tax codes. (See §§ 302-17.8(b)(1) and 302-17.8(c)(2).)
(g) Any tax liability resulting from the payment of recruitment, retention, or relocation bonuses authorized by the Office of Personnel Management pursuant to 5 U.S.C. 5753 and 5754, or any other provisions which allow relocation payments that are not reimbursements for travel, transportation, and other expenses incurred in relocation.
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§ 302-17.4 Why is the reimbursement for substantially all, and not exactly all, of the additional income taxes incurred as a result of a relocation?

Because of the complexity of the calculations, which involve not only Federal income tax but also the income tax rates of many states and localities, it is not reasonable for the Government to compute the exact impact of relocation on an affected employee's taxes. Making a good faith effort to reimburse substantially all additional income taxes is sufficient. The statute where this appears, at 5 U.S.C. 5724b does not define substantially all. This Part provides the description through its provisions.

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United States Code
U.S. Code: Title 20 - EDUCATION
Presidential Documents

Executive Order ... 11609