Published on April 08, 2014

threeway_campaign_photo-240x160.jpgSome corporate relocation packages offer the red carpet treatment, taking care of every aspect of a transferee’s move from travel arrangements and expenses to the actual packing and delivery of household goods. Other relocation packages aren’t quite as comprehensive and require relocating employees to do some of the heavy lifting – like traveling to their point of destination to seek out housing in advance of their move. The good news is many relocation packages offer reimbursement for house hunting.

Here is a list of some of the costs of house hunting that are frequently reimbursed by employers.

  • Travel costs. Because airfare can often be the most cost prohibitive aspect of scoping out new living arrangements in another state or country, most companies will offer to pay their employees back in full for the cost of travel – be that by train, plane, or automobile. This doesn’t mean that house hunting employees should assume they’ll be reimbursed for buying first class tickets, however. Unless it’s absolutely impossible, the most economic means of travel should be booked by the employee.

  • Cost of rentals or other associated transportation fees. If an employee decides to drive themselves across state lines on an extended house hunting expedition, they can expect to receive reimbursement for mileage and any required tolls. Regardless of whether the employee flies or drives, all additional transportation fees should be covered – including rental cars, buses, and taxis.

  • Lodging. House hunting ventures rarely get finalized in a single day. When searching for housing far from home, employees should expect to be reimbursed for hotel stays. As with airfare, lodging arrangements should be realistic – an employee may have a hard time receiving full reimbursement if they opt to rent out the penthouse suite of a high priced hotel.

  • Meals. Depending on the company’s policy, an employee may be given a per diem to cover meal expenses. Other times, meal expenses will be reimbursed for their actual amount and the employee will be required to provide receipts. The majority of the time, alcohol and entertainment won’t be considered a “necessary” house hunting expense and will therefore not be considered reimbursable.

  • Pet kenneling. Employees with pets at home may be reticent to leave their adopted family members behind, especially if they don’t have access to someone who can take care of them until their return. In these cases, the cost of pet kenneling or pet sitting services may be included in a house hunting reimbursement package.

Before packing a suitcase and heading out to scout housing, the first thing any relocating employee should do is check with their employer to determine what kinds of expenses will be covered, in addition to how and when they will be paid back. Always keep track of exact dollar amounts and never overestimate – since the IRS doesn’t consider house hunting expenses a deductible moving expense, any monies paid back to a relocating employee will be reported by their employer as taxable income.

 

Tracking and Reducing  Relocation Costs