Changes to Taxability of Moving Expenses

The Federal Tax Cuts and Jobs Act (P.L. 115-97) signed into law on December 22, 2017 makes ALL employer provided moving expense reimbursements taxable income to the employee.  In addition, moving expenses paid directly to a third party by UCSF on behalf of the individual are taxable to the employee.  We are waiting for more detailed information about the law and for guidance on how the law will impact our operations.  Here is what we know so far about the new law and required changes:

  • Expense reimbursements and payments to third parties submitted on and after January 1, 2018 will be taxable to the employee
  • Expenses occurring in 2017 but submitted for reimbursement or paid to third-parties in 2018 will be taxable to the employee
  • Expenses will be included as income on the employee's paycheck and applicable payroll tax deductions (including Federal withholding and FICA taxes) will apply
  • The State of California has yet to determine if state income taxes will also apply

We will provide updates on the impacts of the new law as they become available.  UC Business and Finance Bulletin G-13, Policy and Regulations Governing Moving and Relocation will be revised by the Office of the President to reflect these changes.