Qualified vs Non-Qualified Moving Expenses
The payment or reimbursement of moving expenses may affect the employee's tax liability. The new employee should be made aware of the potential financial impact:
QUALIFIED MOVING EXPENSES - Payments to vendors or reimbursements to employees for certain moving expenses will not be reported as taxable income on the W2 Form if the following conditions are satisfied:
The expenses for the costs of moving household goods are reasonable. For moves made by a professional moving company, reasonable costs are defined as the SUS Contract Vendor rates with applicable discounts.
The expenses do not include any expenses for meals.
If the new principal place of work is outside the United States and its possessions, the costs for storage of household goods are qualified moving expenses.
The new principal place of work is at least 50 mile from the former residence.
- The employing agency reasonably believes at the time of payment or reimbursement of moving expenses, that during the period immediately following employment at the principal place of work the employee will be full-time for at least 39 weeks.
- A reasonable move originating from basically a single location with delivery to one location occurring at about the same time.
- Consumable supplies such as boxes and packing materials.
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