Issues like compliance and taxes related to a move often can be a point of confusion for many people. Hilldrup Relocation partners with companies whose expertise in these areas help complement the services we already provide. For example, Hilldrup Relocation’s global expense management partner, Orion Mobility, assists clients and job candidates with tax compliance.
We talked with Quentin Hormel, Orion’s tax manager, to see what tips those who are relocating for work should follow to make sure they get all the available reimbursements and deductions related to their move.
What should people first do at the start of their relocation process?
Spend some time making sure you understand your relocation benefits, including your tax benefits, for future reference. It’s also important to stay organized and start reporting expenses and tracking deductions from the beginning. Maintain your own file of office memos, any correspondence, receipts and documents related to the move. It is tremendously easier to do this from the start versus trying to go back months later to find old receipts and notes.
Every state has their own tax laws. What information should people moving to a different state update so that they don’t run into issues when it comes time to file their state return?
If you’re moving to another state, your payroll and relocation departments will need to update your work state in their systems, as well as your new mailing address and phone number. In addition, your relocation department will likely need your correct marital status and 1040 exemption number (the number of exemptions you will claim when you file your federal tax return, not the W-4 exemption number that is used for withholding purposes by payroll).
In many cases, relocation might also need to know whether you are an itemizer or non-itemizer, which is often determined by your homeowner/renter status. This information can help provide a much more accurate gross-up calculation at year-end.