3510 Faculty & Staff Relocation Expenses

Policy Sections

3510.1 Relocation Expense Offers

3510.2 Relocation Expense Payments & Reimbursements

3510.3 Specific Rules for Relocation Expenses

3510.4 Taxation of Relocation Expenses

This Policy establishes the rules and processes governing relocation expenses for faculty and staff.  It applies to all faculty and staff for whom the University agrees to pay relocation expenses.

Policy Statement

As one of many tools for recruiting the best possible talent for faculty and staff positions, the University may offer to cover some or all allowable relocation expenses.  Expense limitations should be negotiated at the time a position is offered and included in the offer letter.  The University will only pay for substantiated expenses within the negotiated limitation.

Relocation expenses may be either paid directly by the University to Yale-approved suppliers or reimbursed to the individual as out-of-pocket expenses.  Relocation expenses must be processed in accordance with Procedure 3510 PR.01 Faculty & Staff Relocation Expense Payments & Reimbursements.

Reason for the Policy

In the instances when the University agrees to cover relocation expenses for individuals, it is important that the relocation expenses are processed and recorded properly.  Compliance with this Policy ensures the appropriate handling of relocation expenses.

Policy Sections

Hiring Units have the discretion to cover full or partial relocation expenses for faculty and staff.  Any expense limitations should be negotiated at the time a position is offered and included in the offer letter.  For staff hires, decisions regarding relocation expense offers should be made in consultation with Talent Acquisition.

Relocation expenses may be either paid directly by the University to Yale-approved suppliers or reimbursed to the individual as out-of-pocket expenses.  The individual may choose which method to use.  The University will, however, only reimburse for out-of-pocket expenses up to the dollar amount it would have cost using one of Yale’s contracted movers, as determined by Yale Relocation & Logistics Management (“YR&LM”).  For either method, relocation expenses must be processed in accordance with Procedure 3510 PR.01 Faculty & Staff Relocation Expense Payments & Reimbursements.

Allowable Relocation Expenses

The University considers only certain expenses to be allowable relocation expenses.  Refer to Procedure 3510 PR.01 Faculty & Staff Relocation Expense Payments & Reimbursements for the complete list of allowable expenses.

Individual units may choose to cover expenses not included on the allowable relocation expense list, provided the expenses are otherwise permissible, pursuant to University Policy.  All such expenses, however, must be processed as “additional taxable income” rather than relocation expenses.

Distance Requirement

Units may only consider covering the full or partial relocation expenses for individuals who meet the following distance requirement:

• The employee’s new workplace (Yale workplace) must be at least fifty (50) miles farther from the employee’s current home than the employee’s previous workplace was from the employee’s current home.  For example, if the employee’s previous workplace was three (3) miles from the employee’s home, the new workplace (Yale workplace) must be at least fifty-three (53) miles from the employee’s home.

Only if the individual meets this distance requirement may a unit cover the relocation expenses for a proposed move to within a reasonable commuting distance of the new workplace.

Timing Requirements

Individuals must incur relocation expenses within one year from their date of hire for the University to agree to cover. If submitting relocation expenses for reimbursement, individuals must, consistent with the University’s reimbursement Policy, submit such expenses within 120 days from the date incurred.

Faculty and staff who are terminated or who voluntarily resign from the University with less than one year of service may be liable for repayment of any covered relocation expenses.     

Payment of relocation expenses is generally considered taxable income to the employee, subject to income tax and employment tax withholding.  Refer to Procedure 3510 PR.01 Faculty & Staff Relocation Expense Payments & Reimbursements for further detail.   

Note: expenses associated with temporary work assignments are not considered relocation expenses and are not covered under this Policy.  Generally, a temporary work assignment is one in which the employee is away from the employee’s tax home on a temporary assignment that is realistically expected to last (and does in fact last) for one (1) year or less.  Be advised, however, that expenses related to moving household goods and personal effects, even for temporary work assignments, are generally considered taxable income to the employee. 

Exceptions to this Policy require prior approval by the Controller’s Office, in consultation with the Provost’s Office, General Counsel, or an Officer of the Corporation, as appropriate.

Roles & Responsibilities

Hiring Unit

• Determines whether to offer to cover relocation expenses for an employee.
• Determines relocation expense limitations.
• For staff hires, consults with Talent Acquisition regarding relocation expense offers.

Employee (Faculty or Staff)

• Makes relocation arrangements in accordance with Procedure 3510 PR.01 Faculty & Staff Relocation Expense Payments & Reimbursements.
• If the employee chooses to pay out-of-pocket and seek reimbursement for relocation expenses, the employee submits all necessary supporting receipts.

Lead Administrator

• Reviews relocation expense reimbursement requests submitted by the employee for completeness and appropriateness.
• Approves substantiated and appropriate reimbursement requests.
• When appropriate, delegates responsibilities to an operations manager or other individual with comparable authority.   

Yale Relocation & Logistics Management

• Works with employees to arrange relocations.
• Coordinates with Accounts Payable to issue direct payments to Yale-approved moving companies.
• Reports direct payments to the Payroll Department for tax purposes.
• Reviews relocation expense reimbursement requests submitted and approved by an employee’s unit for completeness and appropriateness.
• Approves substantiated and appropriate reimbursement requests.
• Submits relocation reimbursement information to the Payroll Department for processing.

Accounts Payable Department

• Processes requests for direct payments to moving companies.

Payroll Department

• Processes relocation expense reimbursement requests and includes the amount as taxable income.
• Records direct payments made to moving companies, as informed by Yale Relocation & Logistics Management, and imputes appropriate amounts into employee income.

Tax Office

• Advises the community on the taxability of relocation expenses.

Controller’s Office

• Interprets Policy and provides exceptions, when appropriate.