As Bristol highlighted in our Client Connect Alert last week, Congress is considering changes to the U.S. tax code that would eliminate vital relocation tax deductions that have been central to our industry for over a half-century.
We join the Worldwide ERC in encouraging action in support of preserving the moving expense deductions. A repeal as currently proposed would add considerable tax gross-up costs for companies who offer tax assistance to their relocating employees, or it would add these costs directly to individuals which typically amounts to thousands of dollars in additional expense per employee and therefore, represent a significant barrier to relocation.
Bristol’s opinion: The facilitation of free movement of people is at the heart of our profession. We embrace the notion that business and economic health thrives when the right individual can be placed in the right role, in the right place, at the right time, quickly, and at reasonable cost. In addition, from an individual’s perspective, the opportunity to make that move enhances the pursuit of happiness and upward mobility. Relocation is central not only to achieving business excellence but indeed, is central to American culture itself. As we know, it is extremely expensive as it is and is on the verge of becoming even more so. We encourage our clients and partners to voice their opposition to the current tax proposal, which would have a chilling effect on companies’ time-honored ability to deploy their business and talent management strategies.
Further details, including suggestions on how to write your member of Congress, may be found here: Act Now!
We will continue to provide you with updates on any developments as they occur. We welcome your comments and questions on this issue. Please send all inquiries to your account director or firstname.lastname@example.org