The University of Oregon moving expense policy allows for a new employee to be reimbursed for moving, house-hunting and temporary living expenses.
Effective January 1, 2018, the UO has made changes to the ways that employees are reimbursed for moving/relocation expenses. These changes are a result of the Tax Cuts and Jobs Act (“H.R. 1”), passed by the United States Congress in late 2017.
Specifically, H.R. 1 suspends both the UO’s ability to reimburse employees for qualified moving expenses on a tax-exempt basis and the employee’s ability to claim qualified moving expenses as deductions on personal income tax (per sections 11048 and 11049). These suspensions are effective until December 31, 2025.
What this means: The UO can continue to offer relocation packages to new employees, but those payments are now:
- processed through a Banner Invoice,
- will be submitted to Payroll by Accounts Payable,
- still subject to current expense restrictions and limits as outlined in our previously published Summary Table . The university is currently considering changes to this reimbursement model. And an announcement will be made when finalized.
When the University of Oregon either reimburses a new employee directly or pays a third party for moving expenses, the applicable taxes reduce the employee’s gross income at the supplemental tax rate that also will include the employee's share of FICA (Social Security & Medicare) tax. The 2019 Federal supplemental tax rate is 22%, FICA rate is 7.65%, and State of Oregon rate is 9%. Because payroll taxes cannot be taken out of a moving expenses, which are reimbursed/paid through Accounts Payable, the tax due on moving expenses paid or reimbursed will be applied and withheld in the pay period at the end of the month following the month when the moving expenses were posted. Please have your new employee plan accordingly.
Moving expenses should be approved in advance. Academic departments should seek approval from their Deans. All other offices should seek approval from their department head and the appropriate Vice President. A memo should be prepared and submitted before the move occurs. Include the name of the new employee, the funds being used and the dollar amount.
Moving expenses may be reimbursed to the employee or paid directly to a vendor. The text of your banner document should include the following information:
- New employee's full name
- New employee's banner ID
- Detailed itemization of the expenses
- Amount of the Moving Allowance/Budget approved
- Allowance Approved by
- Taxable (10780) this is the only account code that can be used on these expenses. Please review the current calendar year One Page Moving Summary Table.
- One page summary table 2019 the only change is mileage rates applicable to the year of the move.
- One page summary table 2018
- Letter of Introduction
- Moving Van Price Agreements
- Payment Options
- Moving Expenses, UO Fiscal Policy Manual
If you have questions about moving expenses contact Joy Germack, Senior Tax Accountant/Analyst at 346-0782.