As of January 1, 2018 the Tax Cuts and Jobs Act made moving expenses taxable by suspending the tax exclusion for qualified moving expenses. All personal moving expenditures, allowance or reimbursement, are considered by the IRS to be portions of compensation and are taxable to the employee as well as to the employer. The IRS inclusion of moving expense payments as a salary item also requires that ERE be applied. As a reminder, ERE for all salary expenditures, including allowances, must be consistently applied at the rate appropriate for the type of employee.
To better welcome new employees and reduce the burden on University staff, the relocation expenditure process will be streamlined to pay household moving expenditures via a moving allowance. This method will provide the employee a flat amount, selected by the home department, 100% of which will be taxable and included on their W-2.
The moving allowance will be contractually agreed upon through inclusion in the offer letter and submitted through the Moving Allowance payment request in UAccess Employee.
Expenses for moving laboratory and office equipment directly to the University must also be included in the offer letter and will be paid directly to vendors or reimbursed to the employee through the UAccess disbursement process separately from the employee’s household moving allowance.
Please refer to The Financial Services Manual 9.14, Relocation Policy for Employees for additional information on the policy.
How to create a Moving Allowance Payment Request
From Uaccess Employee go to: UA Manager Self Service Menu > MSS WorkCenter & Approvals Tile > Payment Request > Request a Payment/Adjust Hours > Moving Allowance
(You must be provisioned for the security role: UA_HR_PY_Request_Allowance - Pay Request Creator/Approver with Cash Allowance)
- Takes Effect On: Use the first Day of the Pay period the payment is owed or the start date of the position if the start date took place in the middle of a pay period
- Take This Action: Start Payment should be used to process payment
- Deptid for Routing: The Dept id used will be used for routing based on UAFinancials Approvers List
- Accounting Information: Set Acctg: The account number used will be used as the funding source
- Sponsored Accounts should not be used as a funding source and will be rejected
- Continue > >
- Empl ID: The employee ID of the employee receiving the allowance
- Payment Amount: Amount of allowance agreed upon in the offer letter
- Reimbursements must be submitted through Accounts Payable – Reimbursements will be allowed only for outstanding offer letters issued prior to April 9, 2018, and for any laboratory or office equipment moved directly to the University.
- Goal Amount: Amount of allowance agreed upon in the offer letter
- Reimbursements must be submitted through Accounts Payable – Reimbursements will be allowed only for outstanding offer letters issued prior to April 9, 2018, and for any laboratory or office equipment moved directly to the University.
- Submit
- Add Attachment: The signed copy of the offer letter that indicates the money owed is a moving allowance
- A copy of the addendum letter to indicate the agreed upon change to a moving allowance for any offer letter issued prior to April 9, 2018.
- Reimbursements must be submitted through Accounts Payable – Reimbursements will be allowed only for outstanding offer letters issued prior to April 9, 2018, and for any laboratory or office equipment moved directly to the University.