Employee Relocation Reimbursement Payments

What Is Relocation Reimbursement?

Relocation reimbursement means employees send in receipts for approved relocation costs. The relocation expenses are reviewed to see if they qualify under the relocation reimbursement policy. If yes, the employee is reimbursed.

Employers using moving expense reimbursement have greater control over how benefit dollars are spent over a lump sum relocation allowance, which allows the employee to spend the benefit as they wish. Typical expenses reimbursable relocation expenses include:

Home‑finding trips
Temporary housing/living
Lease break fees
Final Travel to the new location
Home sale costs
Home purchase costs
Duplicate housing
Household goods moving & storage
Miscellaneous moving costs
Spousal assistance

Since employees submit receipts, relocation reimbursement lets you see exactly what’s being spent and makes it clear what’s covered. With a platform like ExpensePort™, the whole process is automated, governable, and simple for both HR and employees.

What Are the Pros of the Relocation Reimbursement Model?

Here is why HR teams choose the moving expense reimbursement method to pay for and manage relocation expenses:

Your employee relocation reimbursement policy clearly lists what’s covered. Employees submit receipts, and only approved relocation expenses are reimbursed. This ensures that employees stay within expected benefit limits, and employers stay within budget. It also creates historical spend data that can be used to support or indicate needed adjustments to existing policy benefits.

Employees can pick the vendors, timing, and services that they prefer.

Every reimbursed relocation expense is tracked, categorized, and documented.

With ExpensePort™’s direct employee relocation reimbursement model, HR doesn’t have to manually review receipts, track previously reimbursed expenses, approve payments, or work with accounting.

How Employee Relocation Reimbursement Works with ExpensePort™

ExpensePort™ uses a Direct Relocation Reimbursement Model to remove administrative work from HR and accounting teams. This is especially valuable for medium‑sized companies that don’t have a dedicated relocation or global mobility department.

Here’s how ExpensePort™’s moving expense reimbursement works:

1. Employees Submit Receipts Online

Employees easily upload their receipts and expense details to ExpensePort™’s app or online platform.

2. ExpensePort™ Audits Each Expense

ExpensePort™ compares each submission against your relocation reimbursement policy to make sure:

The reimbursable relocation expense is eligible per policy
The reimbursed relocation expense does not exceed the stated policy caps/budget
The moving expense reimbursement amount is reasonable
The documentation is complete
The expense has not been submitted previously for reimbursement

ExpensePort™ makes sure your relocation reimbursement policy is consistently adhered to.

3. ExpensePort™ Issues the Relocation Expense Reimbursement Payment Directly to the Employee

After approval, ExpensePort™ processes the relocation reimbursement and pays the employee via the method you choose: payroll, Instant Card, ACH/direct deposit, or check.

4. ExpensePort™ Tracks All Employee Relocation Reimbursement Data for Reporting, Billing, and Taxes

ExpensePort™ maintains detailed records for:

Payroll reporting
Taxable relocation reimbursements
Historical reporting
Vendor audits
Budget tracking
Policy exceptions
Declined expenses

Managing Taxable Relocation Reimbursements

Since the Tax Cuts and Jobs Act, almost all relocation reimbursement payments are treated as taxable benefits. Employers must accumulate and report taxable moving expense reimbursements on employees’ W2.

ExpensePort™ makes managing taxable relocation reimbursements easier by:

Flagging taxable vs. non‑taxable expenses
Creating payroll‑ready reporting
Checking compliance with IRS rules
Calculating relocation gross‑ups if your policy includes them
Tracking year‑end totals for W‑2 reporting

Make sure your relocation expense reimbursements are properly tracked and reported, and your employees won’t be caught off guard at tax time.

Scenarios for Moving Expense Reimbursement

These are common situations that use relocation reimbursement payments:

New Hire Relocation

A new employee moves to join your company and submits receipts for approved expenses.

Internal Transfers

Employees who move between offices or regions can get reimbursed for relocation expenses without needing a full relocation package.

Temporary Assignments

Short-term moves for a work assignment need housing, travel, and transportation reimbursements. Treatment of assignment costs may become taxable under certain circumstances.

Recruiting and Interview Travel

Candidates can submit receipts for flights, hotels, meals, and transportation.

FAQs About Reimbursable Relocation Expenses

How does moving expense reimbursement differ from a lump sum?

A relocation lump sum is a set amount paid in advance. With moving expense reimbursement, payment is made after receipts are submitted and approved, and is specific to the receipt amounts.

How does moving expense reimbursement differ from managed relocation services?

With moving expense reimbursement, the employee pays eligible costs upfront and submits receipts for reimbursement in accordance with your policy. Managed relocation services involve a relocation management company that coordinates vendors, books services, pays expenses directly, and manages the move for the employee.

Is relocation reimbursement taxable?

In most cases, yes. ExpensePort™ identifies taxable relocation reimbursements and gives you payroll-ready reports.

Can we customize our relocation reimbursement policy?

Yes. You can adjust your relocation reimbursement policy based on job level, distance, family size, or business needs.

Relocation Reimbursement Payment Processing

Relocation Reimbursement Payment Processing with ExpensePort