Skip to main content

New Employee Moving Expenses and Relocation Allowance

The University has established policy number 4020 “Moving Expenses and Relocation Allowances” in the University Administrative Policies and Procedures Manual, or “UAPPM”, detailing the process for the two options of paying an allowance for, or reimbursing the allowable moving expenses of eligible new employees.

As per section 4.1 of the policy, the new employee may elect to receive a lump-sum “relocation allowance” payment.  This payment is paid through Payroll, with applicable taxes withheld, on the employee’s first payroll distribution, or as soon thereafter as practicable depending on the submission of the request to Payroll.  The form that must be completed, signed, and submitted to Payroll in order to generate the payment is located here: Relocation Allowance Request Form.  Under this option, no receipts are required to be submitted.  The employee may subsequently claim applicable moving expenses on their tax return.  Employees should consult a tax advisor; UNM staff does not provide tax advice.

The second option for payment of the moving expense amount detailed in the hiring proposal is to submit for reimbursement actual allowable moving expense payments incurred by the employee.  This is detailed in section 4.2 of the policy.  This section of the policy is based in part on IRS Publication 521 “Moving Expenses”.  This publication details the types of expenses that are and are not deductible for federal income tax purposes.  In general, these same guidelines are applied by Financial Services accounting office staff in
determining if expenses paid by UNM in regard to a new employee’s relocation are to be considered a taxable benefit to the employee.  In addition the publication also addresses the fact that IRS accountable plan rules must be met.  The specific requirements in the publication are:

  • Your expenses must have a business connection, that is, you must have paid or incurred deductible expenses while performing services as an employee of your employer. Two examples of this are the reasonable expenses of moving your possessions from
    your former home to your new home, and traveling from your former home to your new home.
  • You must adequately account to your employer for these expenses within a reasonable period of time.
  • You must return any excess reimbursement or allowance within a reasonable period of time.

As with the reimbursement of other employee business expenses, a “reasonable period of time” is defined to be sixty (60) days.  Understanding that there are special circumstances surrounding when reimbursements of moving expenses can be made (specifically the fact that the employee must have first already started their assignment), the following are the expectations:

  • New employees, for whom moving expenses are to be reimbursed, should be notified by their employing department that receipts should be submitted within thirty (30) days of their employment start date, or if the expense is incurred after their start date, the receipt(s) should be submitted within thirty (30) days from when the expense was incurred.
  • The department should submit the reimbursement request via Chrome River Expense, selecting the “Moving Expenses” payment type under the “Employee Other” tile.  Final departmental approval in Chrome River should be completed within the sixty (60) day requirement from the time the individual started employment, or incurred the expense, whichever is later, in order to avoid the reimbursement being treated as additional taxable compensation.
  • Financial Services will review the request, making note of items that are considered “taxable benefits” (not deductible per IRS guidelines).
    • Upon final review, and after confirming that the individual is noted in Banner as an active employee (i.e., after their start date), the request will be approved for payment, and the appropriate reporting of expenses will be provided to Payroll, for any applicable tax withholding and subsequent W-2 reporting.