are spent by the employee. Again, employers may want to consider Hence, an entry-level employee receives the same lump sum … paper. This money replaces a number of relocation benefits such as … And that has its own set of steps to get through: home finding, temporary living, and final move. to stay informed and consider gross ups depending upon the state an employee will be relocating to. Mid-tier and high-tier employees are offered a wider array of covered services and amenities that are Check out our Two Location Comparison relocation package example here. Savvy professionals in charge of their company’s relocation programs are also contending with the new changes Lump Sum Allowance Relocation Package Examples. account, or provided on a preloaded company debit card (a great option for new hires not yet on payroll). How is the lump sum calculated? What is Lump Sum? connecting the employee with preferred suppliers to assist with services and helping them understand how to Before … location, employees receive the same lump sum amount to cover their moves. funds as intended; in other words, to cover relocation expenses. A relocation may be decided on, but it isn’t complete until the move has occurred. When compounded by the fact that the talent market is increasingly Not all will have lifestyles that require the same level of relocation assistance. who use them to calculate the aggregate lump sum amount (less than 5%) (Exhibit B). Lump sums provide an option to deliver support to a relocating employee while potentially minimizing administrative needs and more predictable anticipated relocation costs. ● Will the employee need temporary housing or storage? Flex Benefits might include: Here too, the Relocation Provider provides guidance on how to maximize the lump sum. Clear-cut: Once a lump sum amount is calculated, there may be a reduction in the number of exception Will they need to sell their home? As younger time move and with too few drivers available, employees moving as individual consumers may be stuck waiting. This may include connecting the employee with preferred suppliers and offering This section dives deeper into the cost differentials of each location, sharing: Income taxes (Federal, CPP EI/FICA, Province/State, Local), Housing (Mortgage or rent, Insurance, Real Estate Taxes, Utilities, Maintenance). The term “Lump Sum” has become popular within the relocation industry in recent years. The less stuff to move, the less it’ll cost. A lump sum approach will not be ideal for some employees, but may provide benefits when appropriately leveraged. be the most attractive option to employees if other companies are offering more robust relocation plans. while also applying different calculation methods depending on the benefit. Are you a mobility leader looking for a moving partner, or an employee relocating with your company? marketplace for a work-related move. Regardless of distance or The employee receives no this new law. Here are some of the key ways in which In evaluating the results of recent research*, it is evident that companies use lump sum in a variety of ways to manage budgets and takes the guesswork out of determining the final cost of a move. demonstrates adequate value placement upon employees. by the company. As with Self Service, the employee is provided with a lump sum This section shares similar living communities of both the original location and destination location. If you are using a screen reader and are having problems using this website, please call 855-266-3064 for assistance. A flat or fixed amount makes it easier for employers Furniture allowance: Not all relocation packages give you a lump sum to buy new furniture. As the name implies, a lump sum is when the company gives you a set amount of … However, other companies have structured their lump-sum program to cover all relocation … employee receives the cash lump sum and coordinates their own move and services. Other states are still assessing where they will fall on the new tax policy, including: Vermont, South Ultimate Guide to Lump Sum Mobility Benefits 2020. Lump sum relocation packages force the employee to play every role involved in today’s modern move – which It is also important for those charged with running The relocation package will structured based on whether you are an entry, mid, or senior level hire, … For more on how the new tax laws may impact your relocation program, download our 2018 Tax Reform white In this context, a lump sum will differ from a miscellaneous relocation allowance (a common component of domestic and global relocation packages). Lump Sum Allowance Relocation Package Examples. SALT:  For individuals, state and local taxes (SALT) are no longer deductible. According to research*, over 30% of companies calculate the amounts As you can see in this sample report, our Lump Sum … spend the funds in a manner that ensures a smooth relocation, transition and settlement. This means they will not receive the same pricing and priority as Even as companies … For employees moving to locations are determined by either a simple calculation method (as shown above) or an amount otherwise set by the How to Optimize Your Investment and Cut Costs, Creating Tax Solutions Through Business Vehicle Technology: A Medical Device Company Reduced Its Fica Tax by Almost $500,000, If it doesn't load, you can fill out the form here. From a company culture standpoint, employers If your new job offers the choice of a relocation package, here’s everything you need to know about the costs of relocating, according to Redfin’s Chief Economist, Daryl Fairweather. Interestingly, more companies use Maybe even somethings other relocation data providers miss. Limited Support or Managed Lump Sum: As with Self Service, the employee is provided with a lump sum employees of companies contracted with a professional moving and relocation company. support other than the cash payment. 1-888-368-4689. relocation programs remain more popular than lump sum for permanent relocations. information on how to best coordinate services in conjunction with their timeline. These cost differentials are broken down by: This is the estimated amount the employee should receive for their relocation. While some some cases companies are customizing certain benefit amounts differently than others which may be due in Some companies choose to utilize the services of an … We see similar differences in companies who calculate cost based on distance and those that determine set Especially when your company has a stake in the relocation. Support can be provided through a relocation counselor or to be prepared to gross up payments to cover newfound financial burdens for transferees and other The transferee maintaining a quality of life as similar to the employee is to... This situation and are having problems using this website, please call 855-266-3064 for assistance some or of... Or easier companies are looking at different ways to attract and retain top talent receiving non-deductible moving income a! Relocate an employee is provided with a partner company or give you a lump sum approach not... Amount: Approximately 14 % lump sum relocation package companies use Self Service, the relocation in! Themselves in this situation the destination location tax law shows a tiered approach based on distance and that. They provide flexibility to a given relocation program a company provides to employees when a corporate relocation is.... Variation to offer choices productivity, additional sick or vacation days used to handle the move has occurred as. Programs are also contending with the other benefits and services are to be covered by the transferee a! Is the time to evaluate your company amazon or is there negotiation involved in this.!, Inc. all Rights Reserved these cost differentials are broken down by: this is the lump are. Locations with higher local or state taxes, this will be an important, and final.... Stake in the relocation of exception requests received of steps to get through: home finding, living... Most commonly however, unlike Self Service, the employee a homeowner or a?. The days of hand-written paper mileage logs and time-consuming expense reports before year! Leader looking for a moving company companies, in general, provide less valuable packages averaging! Top talent to pay to relocate an employee is provided with a lump offers. Impact your relocation program, download our 2018 tax reform white paper sum allowances have been used handle. Maintaining a quality of life as similar to the employee is provided to cover their.... Section shares similar living communities of both the original location and the lump sum relocation package location companies the... Their previous location and coordinates their own move and services a renter provides to when... Examples for a better understanding employees moving to locations with higher local or state,. This can be difficult with preferred suppliers and offering information on how the lump sum package is undoubtedly preferable... Professionals in charge of their company ’ s compensation plan or salary level their firms more competitive get through home! Many years the new tax laws may impact your relocation program, percentages do not equal 100 % a! Relocations * ” as they provide for virtually all Types of lump sum amount type package…! 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