Under regulations prescribed under section 5738 of this title and to the extent considered necessary and appropriate, as provided therein, appropriations or other funds available to an agency for administrative expenses are available for the reimbursement of substantially all of the Federal, State, and local income taxes incurred by an individual, or by an individual and such individual’s spouse (if filing jointly), for any travel, transportation, or relocation expenses furnished in kind, or for which reimbursement or an allowance is provided (but only to the extent of the expenses paid or incurred). Reimbursements under this subsection shall also include an amount equal to all income taxes for which the individual, or the individual and spouse, as the case may be, would be liable due to the reimbursement for the taxes referred to in the first sentence of this subsection.

For purposes of this section, the term “travel, transportation, or relocation expenses” means all travel, transportation, and relocation expenses reimbursed or furnished in kind pursuant to this subchapter or chapter 41.