WASHINGTON, DC – Today, U.S. Senator Angus King (I-Maine) cosponsored bipartisan legislation to provide financial relief to certain civilian federal employees who have to relocate for work. The Relocation Expense Parity Act will ensure that all federal employees who qualify to have their moving costs reimbursed by the government are also repaid for the taxes owed on relocation reimbursements – a longstanding fiscal policy that the Tax Cuts and Jobs Act of 2017 eliminated.

“It’s an old saying, but a wise one: If it ain’t broke, don’t fix it. Unfortunately, the 2017 tax bill ignored this rule, and broke something that was working for a small number of federal workers who are required to move for their jobs,” said Senator King. “This legislation would right a wrong created by the tax bill, and make sure that public servants moving in order to start or conclude their duties aren’t burdened with an additional tax.”

When federal workers must relocate as a part of their professional duties, the federal government covers their moving expenses. Until the Tax Cuts and Jobs Act of 2017 passed, federal worker relocation allowances were tax-free; unfortunately, that legislation made relocation allowances for newly hired and retiring federal employees taxable. This situation is causing a particular burden for civilian federal employees who, after being assigned to a new duty station, have discovered that hundreds or even thousands of dollars are withheld from their paychecks, often with little advance notice, in order to cover the cost of taxes associated with moving reimbursements from the federal government.

The Relocation Expense Parity Act would close the gap for these workers, who comprise five percent of the federal workforce. The Act will benefit agencies that are likely to have recruitment problems if they do not compensate employees for their relocation reimbursement taxes. The Department of Defense, for example, hires thousands of teachers for schools on military bases across the globe, and moving cost reimbursements can artificially inflate teachers’ salaries, burdening them with steep taxes. Departments like the Federal Bureau of Investigation (FBI) would also benefit from this legislation, as they have a high number of transfers upon hire.

In addition to Senator King, the legislation is supported by U.S. Senators Chris Van Hollen (D-Md.), Mark R. Warner (D-Va.), Tim Kaine (D-Va.), Susan Collins (R-Maine), and Mazie Hirono (D-Hawaii).