Moving (Relocation) - Temporary Housing

Temporary Housing

Reimbursements to employees for temporary housing/living expenses related to a move are considered taxable income.

Taxes are withheld at the supplemental tax rate of 25 percent for federal and 4.63 percent for state. Housing/living expense reimbursements are subject to Medicare tax and OASDI (if applicable), but are not subject to mandatory or supplemental retirement deductions.

For more information, see Moving (Relocation) and view the IRS Moving (Relocation) – Form 3903 .

Note: Reimbursement for housing expenses related to relocation should not be confused with Housing Allowance, which is an ongoing payment unrelated to a move. 

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