It is the policy of the University of Wisconsin System and the State Department of Employment Relations to allow institutions to pay relocation and related temporary lodging expenses for new and presently employed personnel assigned to new locations by transfer or promotion. Refer to Section IV for guidance involving living expenses in connection with a temporary or indefinite work assignment away from the employee's permanent worksite which does not involve a household move.

Section 20.917, Wisconsin Statutes, provides for the reimbursement of relocation expenses and authorizes the Office of the State Employment Relations to establish maximum amounts for payment. There are currently no poundage or dollar maximums established. The dollar amount allowed for each move should be established by the appointing authority in accordance with the criteria outlined in Section III. A. below.

Chapter 230.047, Wisconsin Statutes, authorizes state agencies and the University of Wisconsin System to participate in the temporary interchange of employees between and among government agencies at the same or different levels of government and with institutions of higher education. Typical interchanges involving the University of Wisconsin System are with other state agencies, federal agencies, other government agencies such as school districts, and other universities outside the University of Wisconsin System. (See F18, Inter-Institutional Financial Transactions, for the temporary interchange of employees within UW System.)

Chapter 760 Wisconsin Resources Handbook

UW System Travel Regulations govern applicable and allowable travel-related expenses.

IRS Regulations

1. Eligibility

   Within the constraints set forth above, and at the discretion of each institution, reimbursement of relocation expenses of new, reemployed, or presently employed employees assigned to new locations by transfer or promotion in the classified or unclassified service, including faculty, may be authorized. Reimbursement is not authorized for employees appointed as limited term employees (LTEs). Provisions in negotiated collective bargaining agreements prevail for employees covered by such agreements.

   1. Reimbursement of expenses is mandatory when the appointing authority requires the employee to change residence location because the employee is:

      1. ordered to relocate, or

      2. promoted to a different position in the civil service.

   2. Reimbursement is on a permissive basis at the discretion of the new appointing authority for an employee who requests a transfer or demotion and relocates as a result.

   3. Reimbursement of expenses is on a permissive basis, as recommended by the appointing authority, for a person reporting to his or her first place of employment in state civil service or reporting upon reemployment after leaving the civil service.

   4. Reimbursement for an employee's relocation expenses can be allowed if the distance between the new place of employment and the old residence is at least 35 miles farther than the distance between the old place of employment and the old residence, and the distance between the new and old residence is at least 35 miles.

      If the appointing authority determines that a relocation is a mandatory condition of employment under s. 20.917(1)(a), Wis. Stats., the minimum distance requirements are not applicable.

   5. No more than two relocations may be reimbursed to an employee in a calendar year.
   6. Unless otherwise authorized by the appointing authority, to be eligible for moving reimbursement, the employee must move no later than one year from the effective date of the appointment or the end of probation, whichever is later.

   7. New employees or former employees reporting upon reemployment will be allowed reimbursement when approval is granted by the Chancellor or delegated designee. A commitment to the prospective new employee should not be made prior to the Chancellor's or delegated designee's approval.

   8. It should be determined whether it is in the best interest of the UW to provide reimbursement for relocation and travel expenses. The following circumstances should be considered:
      1. Are the individual's skills in critically short supply? If yes, is payment usually available from competing employers?

      2. Is the labor market tight for this particular position?

      3. Does the individual rank above all other candidates in a combination of training, experience, and personal qualities?

      4. Will the best qualified individual for the position be unable to accept the institution's offer for financial reasons unless relocation expenses are paid?

2. Reimbursable and Nonreimbursable Costs

   1. Household goods are personal effects of the employee and the immediate family of the employee. Examples include furniture, clothing, musical instruments, household appliances, food, and other items which are usual and necessary for the maintenance of a household and which may be transported legally in interstate commerce.

      The following items are NOT considered household effects:

      • property for resale
      • property not owned by the family
      • farm equipment
      • livestock
      • trucks/trailers
      • boats over 14 feet
      • automobiles, motorcycles, recreational vehicles
      • building materials
      • items used in a personal business
      • pets, flammable items, caustic aerosols, spoilable items, plants, jewelry, frozen food, etc., and other items that might be found in a household but which the carrier cannot or will not allow to be placed in the moving van

      The cost to move any of the above-mentioned or similar type items would be considered "incidental costs" (explained under Section B.3.). Any other items that might be considered questionable should be cleared with the Institution Business Office.

   2. Direct Costs of Relocation

      The following direct costs associated with the relocation of household goods are reimbursable, subject to the constraints in Section II. (The item number refers to household goods tariff numbers that often are the only itemization of charges appearing on the bill of lading.)

      • linehaul (rate per 100 lbs. x pounds moved)
      • seasonal rate adjustment (Item 160)
      • weight and bulky articles charges except for items listed in Section III, B.1. above (Item 130)
      • extra labor, i.e., disassemble a swing set, pool table, etc., performed by moving company (Item 120)
      • ferry, bridge, ramp; service charge (Item 155)
      • appliance service (Item 195)
      • packing (Item 105)
      • unpacking (Item 105)
      • containers (Item 105)
      • additional transportation at origin and destination (Item 170)
      • fuel surcharge
      • shuttle

   3. Incidental Costs of Relocation

      The following incidental costs associated with a move are NOT reimbursable as a direct cost of the move but may be covered by a stipend, if granted by the appointing authority:

      • exclusive use/space reservation/expedited service charges
      • valuation/additional insurance (Item 190)
      • extra pickup of household goods (Item 115)
      • storage (Item 185)
      • warehouse handling (Item 210)
      • weight additives for transporting any bulky articles (Item 130)
      • auto hauling or towing (Item 130)
      • travel costs enroute (meals, lodging, tolls, etc.)
      • overtime loading or unloading required by customer (Item 175)
      • weight and bulky article charges for items listed in Section III, B.1.
      • other costs associated with the move
      • third party services
      
      (The item number refers to household goods tariff numbers that often are the only itemization of charges appearing on the bill of lading.)
      
      This stipend amount is discretionary for initial employment or reemployment. Any amount up to $1,000 may be paid whether or not incidental costs are actually incurred, but the stipend must be paid in its entirety in connection with an employer-ordered relocation. A stipend may not be paid more than 30 days prior to the employee's relocation date.
      
      If itemized and supported by receipts, the above incidental costs are not taxable, with the exception of employee meals enroute and storage in excess of 30 days.
      
      

   4. Transporting the Employee and Family

      The amount of reimbursement for transporting (this includes flying) the employee and his or her immediate family from the former residence to the new place of residence may not exceed the cost of mileage for one automobile at the rate specified in Section VIII of the UW System Travel Regulations. The maximum allowable amount shall be based on mileage using the most direct route and shall not exceed the mileage indicated on the bill of lading when a commercial carrier is utilized. However, actual necessary airfare may be reimbursed for overseas relocations.

   5. Piecemeal Moves

      The appointing authority may approve reimbursement for piecemeal moves necessary to transport the employee's household effects from the former residence to the new residence. The total cumulative reimbursed cost of moving household effects on a piecemeal basis may not exceed the amount which would have been charged if the relocation had been accomplished in one trip. To make that determination, an estimate showing the cost to accomplish the move in one trip should be obtained.

   6. Relocating Without a Commercial Carrier

      Should the employee elect to relocate himself or herself, reimbursement for such a relocation is limited to the actual, reasonable, and necessary costs for any hired labor in loading and unloading the household goods and for the rental of trucks, trailers, moving equipment, or other expenses directly related to the relocation. Neither the employee nor the employee's spouse or dependents may be reimbursed for their labor. The reimbursement claim must be supported by original receipts. Estimates are not required for self-moves.

   7. Mobile Homes and Foreign Relocations

      The UW System Travel Office (608-263-0873) should be contacted for relocations involving a mobile home or a move to or from outside the contiguous 48 states and the District of Columbia. For foreign moves, an 18,000-pound maximum applies. Information on how weight is determined for foreign moves can be found in section 302-7.12 of the Federal Travel Regulations.

   8. Temporary Lodging in Connection with a Household Move

      A temporary lodging allowance, not to exceed 45 days nor the in-state lodging maximum, is allowable for employees in the classified and unclassified service, including employees covered by a collective bargaining agreement unless a collective bargaining agreement contains different provisions. The reimbursement days need not be consecutive. Therefore, it is possible for the 45 days of temporary lodging reimbursement to extend over a period of time greater than 45 calendar days. If the temporary lodging is longer than one week, the employee should be encouraged to locate lodging at reasonable weekly/monthly rates.
      
      

3. Institution Responsibility

   1. The recommendation of an appointing authority to pay relocation or temporary lodging expenses must be submitted in writing to the Chancellor or delegated designee for approval prior to the move and before authorizing payments to the employee. The request should contain the reason and the estimated amount of direct and/or indirect costs that are intended to be reimbursed. If partial reimbursement is to be made, that dollar amount should be indicated.

      The Chancellor or delegated designee will approve or disapprove the request and return it to the department, indicating that approval has been granted or stating the reason(s) for disapproval.

   2. When authorization is granted, the appointing authority must inform the employee of the extent of the costs which will be reimbursed. For permissive moves, the appointing authority may limit reimbursement/payment to less than the maximum allowed. The authorization letter should be provided to the employee who will incur relocation costs.

   3. UW System Administration has contracts with two corporate moving companies for substantially reduced rates. Employees are strongly encouraged to utilize one of the contract vendors.

   4. IRS Publication 521 delineates moving expenses which are deductible and nondeductible for tax purposes. Nondeductible expenses are sometimes reimbursed by UW policy. Social security and medicare tax must be withheld by the UW on the following nondeductible reimbursed expenses:
      
      

      • Meal costs
        
      • Mileage in excess of 20 cents/mile, effective January 1, 2007; 19 cents effective January 1, 2008
        
      • Storage for more than 30 days
        
      • Temporary lodging
        
      • Stipend payments
        
      
      

   5. Relocation expense claims must be audited for compliance with the terms of this document.

4. Responsibility of the Employee

   1. The employee is responsible for selecting a household moving company and arranging the terms and conditions of the move. Unless a UW System contract vendor is used, the employee must obtain at least three estimates. It is recommended that estimates from noncontract vendors be binding estimates. The estimates should include the cube sheet/estimating form and must clearly describe the shipment and all services to be provided. Charges assessed by the mover for providing a binding estimate are reimbursable as a direct cost of the relocation.

   2. If the employee elects not to use the UW's contract vendor, the employee may select any of the three carriers, but reimbursement is limited to the lowest of the three estimates. Caution: Scam movers abound. If one of the UW's contract vendors is not used, go to www.movingscam.com and click on the "blacklist" to view a list of companies that have repeatedly practiced scams against consumers.

   3. Any unusual arrangements should be cleared with the employing department prior to making any commitments to the carrier or incurring any expense which may not be reimbursable.

   4. Allowable costs associated with the relocation may be reimbursed to the employee or, at the discretion of the institution, paid directly to the carrier. All parties (carrier, employee and institution accounts payable department) should have advance notification of the payment method which will be used. When payment is made directly to the carrier, sales tax, which may be assessed on containers, should be deducted. The claims must be substantiated by the estimate, an itemized bill of lading, receipts for other allowable move-related reimbursable expenditures and a copy of the approval to pay moving expenses.

   5. When the cost of the relocation is reimbursed to the employee, the employee may request an advance of up to 80% of reimbursable costs based on the lowest estimate. The advance may not be issued prior to two weeks before the move occurs. A copy of the lowest estimate and approval letter must be attached to the request for travel advance.

Reimbursements of expenses for "temporary" assignments away from the tax home are generally not taxable to the employee. If the assignment is "indefinite," the employee is considered to have moved his/her tax home to the new work location. Reimbursements of expenses for "indefinite" travel are taxable. Rev. Rul. 93-86; Rev. Rul. 99-7.

The table below provides a quick summary of the situation, and Attachment 1 lists examples (from the IRS regulations) of "temporary" and "indefinite" travel assignments. The Internal Revenue Service looks at all of the facts to determine whether the travel assignment was intended to be temporary or indefinite. Rev. Rul. 93-86; Rev. Rul. 99-7.