2.570 Moving Expenses/Relocation

Date Composed: 03/04/2003

Date Modified: 07/28/2008

 

This section applies to RCUH employees only. Moving Expenses/Relocation allowances for UH employees funded by UH accounts shall comply with APM A8.863. The reimbursement for moving expenses shall be authorized by the Designated UH Official or RCUH Fiscal Officer.

 

  1. UH employees on UH funded accounts

Please reference APM A8.863 for policies and procedures which govern University of Hawaii Board of Regents (BOR) employees on accounts service ordered by the University of Hawaii to RCUH.

 

The University accounts include the following:

 

 

Claims for these accounts shall be submitted via hardcopy to RCUH Disbursing.

 

  1. RCUH Employees

The moving expense/relocation allowance reimbursement:

 

 

  1. Allowable Expenses

Original invoices and receipts must accompany all claims for reimbursement. All expenses described below are considered deductible moving expenses as described in IRS Publication 521, Moving Expenses, found at http://www.irs.gov. Deductible expenses shall meet the time and distance tests. A move will meet the distance test if the new main job location is at least 50 miles farther from your former home, than your old main job location was from your former home (IRS publication 521). An individual must work full time for at least 39 weeks during the first 12 months of arrival at the new job location and claim expenses within a year of the move.

 

    1. Travel Expenses

Airfare – Airfare reimbursements are limited to the cost of the most direct, least expensive airfare for the appointee and his dependents from his last permanent home address to the new home location. Any side trips or stops shall not be included in the reimbursement.

 

Airfare for a domestic partner may be eligible as a deductible moving expense only if the partner may be claimed as a dependent for tax purposes. If the partner’s airfare is claimed as a tax-deductible expense, the RCUH HR forms “Declaration of Domestic Partnership” and the “Affidavit of Dependency” shall be completed and included with the moving expense claim. Copies will be provided to RCUH Payroll for Form W-2 reporting purposes.

 

Automobile mileage – The use of a private vehicle may be allowed if the cost of the mileage reimbursement and any related costs (i.e. lodging, tolls, parking fees) is less than the cost of airfare. If such a claim is made, a cost comparison worksheet must accompany the claim form. The appointee shall be reimbursed at the Federal mileage relocation rate at the time of the move. Mileage may be incurred to transport household goods to the shipping terminal.

 

Lodging – Lodging is limited to overnight accommodations up to and including the day of arrival. Meals are not deductible moving expenses.

 

Taxi – Taxi fare to the airport on the day of departure and from the airport the day of arrival are allowable.

 

    1. Shipping of household goods and personal effects

The cost of packing, crating and shipping of the household goods and personal effects from the former home to the new home is allowable.

 

  1. Nondeductible Moving Expenses

    1. An employee may be paid for moving expenses that are considered nondeductible by the IRS. The sponsor’s written approval with specific dollar allowances shall be required for payment or receive the sponsor's post approval. If the sponsor has delegated their post-award approval to UH, the Dean/Director shall approve the request. Direct projects should contact their RCUH Fiscal Officer for the appropriate approving authority.

 

    1. The reimbursement will be treated as income, making it subject to tax withholding. Examples of non-deductible expenses are airfare expenses for a domestic partner who does not qualify as a dependent, car rental after day of arrival, costs involved in buying a new home, meals and temporary living arrangements.

 

    1. If a purchase order is issued to a vendor for a non-deductible moving expense, the amount of the payment shall be reported on the RCUH Relocation Form 17 (Attachment 34) and Form 17A (Attachment 35). Include the purchase order number and check number. The payment is taxable income and is subject to tax withholding.

 

  1. Reasonable cost requirement

The appointee should solicit a minimum of three price quotations for reimbursement of moving expenses and select the lowest bidder. Fiscal officers are responsible for ensuring that the costs are reasonable.

 

  1. Accountable Plan Rules

RCUH must meet all three of the Accountable plan rules (IRS section 62c) for the relocation payment to be treated as a reimbursement. If these rules are not met, the relocation payment is treated as paid under a non-accountable plan and is taxable as wages. See Table 2, Reporting Employee Moving Expenses and Reimbursements in Publication 521.

 

    1. Your expense must be of the type for which a deduction would have been allowed had you paid them yourself. The cost must be a deductible expense.

    2. You must adequately account to your employer for these expenses within 60 days after they were paid or incurred. The 60-day time frame is described by the IRS as a “reasonable” period of time (“Reasonable period of time”, Reimbursements Section, IRS publication 521).

    3. If you were provided an advance, you must return any excess reimbursement or allowance within a reasonable period of time.

 

  1. Form W-2 Reporting

    1. Allowable moving expense reimbursements will be reported in Box 12 on an employee’s Form W-2. Non-deductible expenses are reported in Box 1.

    2. The principal investigator shall record the total amount paid to the employee (direct and third party payments) on the receipt statement in the event that the employee separates from service within the first 12-month period. Should the employee separate from service within the first 12-month period, the relocation allowance shall be collected from the employee and returned to the RCUH project account. The PI is responsible for initiating collection activities if the appointee does not fulfill his/her obligation.

 

  1. How to File a claim

    1. The appointee shall complete the Relocation Allowance Form, the Relocation Allowance Worksheet and the Receipt statement. Forms 17 (Attachment 34) and 17A (Attachment 35) and all attachments shall be submitted via hardcopy to RCUH Disbursing. Form 17B (Attachment 36) shall be held on file by the Principal Investigator.

 

    1. Partial claims may be filed. All forms shall be completed for each claim. Claims shall be clearly marked “Partial” or “Final” as appropriate.

 

    1. For UH accounts which utilize the 4-digit UH object codes, use the following relocation object codes:

 

4891 for deductible moving expenses  

4892 for non-deductible moving expenses

 

    1. It may be necessary to establish unique budget categories for reportable/non-taxable relocation expenses as well as reportable/taxable relocation expenses. Contact RCUH Accounting to establish the budget category(ies).

 

    1. The Relocation Allowance Worksheet is forwarded to RCUH Payroll Office for reporting and/or withholding by the RCUH Disbursing Office.