I moved from India to US in Jan 2015 on H1 visa. While filing taxes for year 2015, my tax consultant deducted year 2015 Rent as part of moving expenses.
Last month, I got an Audit notice from IRS asking to submit the proofs and receipts, if not then they are asking me to Pay the tax (and interest on due tax )on the amount that was claimed as moving expenses.
My question is, were this expenses correctly deducted as moving expenses? Was I eligible to claim Rent as moving expenses?
I was reading Pub 521 and as per that I satisfy the criteria of distance and time. Distance of my job location in US is definitely more than 50 miles (since I was earlier living in India). I worked full time for the whole 2015 with my employer.
Any help or guidance on this will be appreciated. Please let me know.
Also, my employer is in different state (more than 50 miles) and I work for a client company which is in different state so my tax consultant is justifying Rent as moving expenses incurred away from tax home.
It's confusing since Pub 521 says Accommodation expenses can be deducted if you are away (more than 50 miles) from your tax home.
Please suggest if there is any specific article regarding this which can shed some light on this.