I. Date of Initiation/Revision
Revision effective July 1, 2009.
II. Policy Classification
Senior Vice President for Administration and Finance and CFO – Controller's Office (Finance Department)
III. Policy Statement
This policy promotes the proper stewardship of University funds by providing general guidelines for the appropriate and legal uses of University funds in support of the University's missions. The University receives, from a variety of sources, funds that carry with them fiduciary responsibilities. Inherent in these responsibilities are the requirement to operate the institution under guidance set forth by the University's Board of Trustees, to properly safeguard and protect University assets, and to comply with all federal, state, and local laws and regulations. This policy contemplates also that certain institutional duties and responsibilities have been delegated to the operating units (department/division) of the University involved in the conduct of business and to display sound ethical business practices in carrying out these responsibilities. This policy will adhere to and be in conformity with relevant Internal Revenue Service (IRS) rules/regulations at all times and subject to change as IRS rules change.
IV. Policy Summary and Definitions
The University Moving Policy provides reasonable coverage of moving expenses for new faculty. Those eligible under this policy are full-time faculty appointed for a term of at least three years. Upon written approval by the appropriate Dean or Vice President, other senior professional and administrative appointees may be considered for eligibility. In these situations, the Controller's Office should be consulted for consideration prior to extending an offer including moving expense reimbursement. The allowance applies to moves to Rochester from the point in the United States or Canada where the major portion of the appointee's effects are located.
The IRS categorizes all moving expenses as either "qualified" or "non-qualified". Only qualified expenses are excluded from taxable income for the employee.
- Adequate accounting: Defined by the IRS as follows:
- You adequately account for your moving expenses by giving your employer documentation of those expenses including receipts and proof of payment.
- Excess amount: Defined by the IRS as follows:
- Any amount you are paid, including advances and allowances, that is more than the moving expenses that you adequately accounted for to your employer within a reasonable period of time.
- IRS: Internal Revenue Service of the United States of America.
- Non-qualified moving expenses: Expenses that are included as taxable income for the employee and defined by the IRS as follows:
- All other expenses associated with relocation, including house-hunting trips, temporary living costs, meals during travel and all other relocation expenses except those specifically categorized by the IRS as qualified (see definition below). Lodging in the Rochester area is non-qualified and non-qualified expenses should not be included in a Request for Moving Advance (F-8).
- Qualified moving expenses: Defined by the IRS as follows:
- 1) reasonable costs of moving household goods and personal effects from the former residence to the new residence and
- 2) traveling (including lodging but not meals during the period of travel) from the former residence to the new residence.
- Reasonable period of time: Defined by the IRS as follows:
- Actions that take place within the times listed are considered as taking place within a reasonable period of time.
- You adequately account for your expenses within 60 days after they were paid for or incurred.
- You return any excess amount within 120 days after the expense was paid for or incurred.
V. Related Policies
See: Mileage Reimbursement
- Central Finance Department
- Advance of funds: The Central Finance Department will make available advanced funds pursuant to moves for eligible faculty and reasonable estimates.
- Reimbursement of expenses: The Accounts Payable Department will reimburse qualified moving expenses submitted within a reasonable period of time on a Moving Expense Report, Form F-7. All other amounts will be reimbursed through Payroll, with appropriate taxes withheld, and reported on Form W2 as appropriate.
- Reporting requirements: Pursuant to tax regulations, the University reports payments of both qualified and non-qualified expenses on the employee's form W2 to the IRS. Non-qualified payments are subject to tax withholding and are included as taxable income. Qualified moving expense payments and reimbursements are considered employee benefits, and are reported as excludable moving expense reimbursements paid directly to the employee, and are not included in taxable income.
- Department/Moving employee
- Payment of moving company expenses: The appointee (moving employee) is fully responsible for payment of moving company charges. University purchase orders are not to be used for paying personal moving expenses. The University will not participate in direct payment to a moving company for household goods and personal effects.
- Advance of funds: Employees entitled to reimbursement for qualified moving expenses may obtain a cash advance from the University by submitting a Request for Advance Moving Allowance, Form F-8, to Accounts Payable no earlier than 30 days prior to the move. The amount of the advance will be based on the employee's good faith estimate of anticipated expenses. Please see UR Moving Estimates table. Upon completion of the move, a Form F-7 must be submitted to Accounts Payable.
- The completed Form F-8 must be accompanied by a copy of the offer letter, an estimate from the moving company and approval of the appropriate Dean, director or department head.
- Adequate accounting: Form F-7, Moving Expense Report must be submitted to Accounts Payable within a reasonable period of time (see Definitions). Where an advance has been provided and no Form F-7 has been received within 120 days, the University is obligated to include the entire amount of the advance in the employee's W2 as taxable income.
- Reimbursement of Qualified Relocation Expenses: Qualified expenses, as defined above, will be reimbursed upon submission of a Moving Expense Report (Form F-7) to Accounts Payable.
- Where travel is by personal automobile, non-taxable reimbursement is limited by IRS regulations to (1) actual, documented out-of-pocket automobile operating expenses or (2) a flat rate per mile consistent with IRS regulations (see Mileage Reimbursement Policy). Lodging during the travel period is reimbursable as a qualified expense, but meals are not.
- The completed Form F-7 must be accompanied by receipts or other original documentation, as well as a copy of the offer letter and approval of the appropriate Dean, director or department head.
- Reimbursement of Non-Qualified Relocation Expenses:
Any University reimbursement of these expenses is fully taxable to the employee.
- Requests for this type reimbursement should be made on the employee's Moving Expense Report, Form F-7, and should be included under the section entitled "non-qualified". Where possible, the request should be included on the same Form F-7 used by the employee to request qualified expense reimbursement, and should be submitted within a reasonable period of time.
- Non-qualified, post-employment moving expense reimbursements are viewed by the IRS as compensation, and University payment is made through the payroll system and is subject to withholding. Form 211, Request for Extra Compensation, must be submitted with Form F-7.
VII. Moving Eligibility
In order to be eligible for reimbursement of qualified moving payments:
- The new faculty must be appointed for a term of at least three years.
- The new faculty must be moving from within the United States or Canada
VIII. Documentation and Reporting Requirements
- By the Department/Moving employee
Documentation required with each form:
| ||F-8 Advance||F-7 Expense Report|
|Copy of Offer Letter||Yes||Yes|
|3 signatures (employee, departmental head, VP/Dean)||Yes||Yes|
|Moving company estimate||Yes||No|
|Receipts and other original documentation supporting expenses||No||Yes|
The University reports payments of both qualified and non-qualified expenses on the employee's form W2 to the IRS. Non-qualified payments are subject to tax withholding and are included as taxable income. Qualified moving expense payments and reimbursements are considered employee benefits, and are reported as excludable moving expense reimbursements paid directly to the employee, and are not included in taxable income.
Page updated 2/17/2012
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