(COPPELL, TEXAS – OCTOBER 5th, 2018) On September 21st, 2018 the U.S. Internal Revenue Service issued a much-anticipated update about whether payments and reimbursements received in 2018 for 2017 relocations would be subject to the old tax law or the new tax law. The decision stated the payments and reimbursements received in 2018 for 2017 would NOT be subject to the new tax law, which went into effect January 1st, 2018. These payments are not to be included as income to the employee in 2018.
If employers have already included these amounts in the employee’s income as employment taxes, they can use the Section 6413 adjustment process or the Section 6401 refund claim process to correct the overpayment of federal employment taxes.
This news is a positive development for employers and transferees, as both can avoid taxes on relocation payments in 2018 for moves that took place in 2017.
About VERSA Relocation
VERSA Relocation, Inc. assists clients with moving employees across the country and around the world. We listen to what clients need and design exceptional programs from an array of relocation services. Aside from being top-notch listeners, we are experts on policy review and design, best-in-class practices, on identifying challenges and unique problems, and working with clients to develop inventive and intelligent solutions. VERSA is one of four companies under the banner of international household goods mover Daryl Flood, Inc. This means two things: VERSA is backed by a financially sound and organizationally constant company – and one with a deep understanding of mobility needs. To find out more about our company, please visit our website at VERSArelocation.com.