Definitions of Relocation Expenses

TermsDefinitions
EmployeeA current UC employee who is transferring UC locations or a new UC employee.
Household Goods and Personal Effects

Household goods and personal effects include furniture, clothing, musical instruments, household appliances, foods and other items that are usual and necessary for the maintenance of a household.

Household goods do not include automobiles, other motor vehicles, farm tractors, implements and equipment, livestock, trailers with or without property, boats that are not the property of the employee’s immediate family or building materials of any description.

Freight CostsFreight costs include the total charges for transporting household effects from the point of origin to the point of destination. Freight costs also include associated charges such as packing containers, labor and insurance on household effects.
Moving and Transferring ExpensesMoving and transferring expenses are defined as the reasonable costs of moving household goods and personal effects to a new residence. These costs also include the cost of travel to the new university location for the employee and his or her immediate family.
Nontaxable Reimbursement Amounts

Nontaxable reimbursement is a reimbursement for moves and transfers that is not included in the employee’s gross income. The amount is recorded on the employee’s W-2 form as a fringe benefit that is excluded from taxation such as:

  • Packing of furniture and personal belongings
  • Transportation of furniture and personal belongings from the old residence to the new residence
  • Insurance and in-transit storage charges
  • Travel and lodging expenses associated with the final move to the new residence for employee and members of employee’s household

See the general definition of recruitment expenses below for a definition of taxable vs. nontaxable expenses.

Provision for Removal ExpenseA fund administered by the Vice Chancellor of Academic Affairs that is used to reimburse departments for all or part of the expenses incurred by moves and transfers of academic appointees whose salary is paid from the account General Funds, 19900.
Reasonable CostsReasonable costs are costs that are considered to be reasonable under the circumstances of a particular move (such as travel from the old to the new residence made via a conventional mode of transportation using the shortest and most direct route available and in the shortest period of time normally required to travel the distance). 
Relocation AllowanceA relocation allowance is compensation intended to offset higher living costs in a new location.
Taxable Reimbursement Amounts

Reimbursement for expenses incurred for moves and transfers that must be included in an employee’s gross income and are therefore taxable.

The following expenses are taxable:  

  • Pre-move house hunting including travel, meals and lodging once an offer has been accepted  
  • Meals and lodging while occupying temporary quarters in the new work location
  • Meals associated with the final move to the new residence
  • Rental automobile costs incurred while the primary automobile is being shipped to the new location
  • Qualified residence sale, purchase and lease expenses (including home improvements, disconnecting utilities, mortgage penalties, real estate taxes, breaking a lease and security deposits)
  • Storage charges, except those incurred in transit and for foreign moves

See the general definition of recruitment expenses below for a definition of taxable vs. nontaxable expenses.

Recruitment Expenses (taxable vs. nontaxable)

The reimbursement of travel expenses associated with interviewing prospective appointees to a position that requires specialized training or experience of a professional, technical or administrative nature.

  • Reimbursements for authorized travel expenses such as airfare, hotel, and meals incurred during the recruitment process are not taxable to the prospective employee.
  • Once an offer of employment has been accepted, travel expenses incurred by the prospective employee and family are considered taxable (such as house hunting trips, temporary housing, etc.).