Question : If my relocation bonus is “Grossed Up”, my employer pays all taxes, right? Will I have to pay year-end taxes?
I started my new job a couple of weeks ago after moving to a new place. In mid-Feb., I will receive a large amount of money as part of the company’s relocation policy. Their relocation partner calculated the amount based on a number of variables in my scenario (single vs. married w/ kids, having to buy a home vs. renting, how many miles the move was, etc). I was told that the amount they quoted me is “the pre-tax, grossed up amount”. When asking them to clarify what “grossed up” means, they stated, “Grossed up means the (business name) takes care of the taxes. The ($ amount) is what you will receive clear – no taxes are deducted from that amount. ”

My understanding is that I will not have to pay taxes on the amount, ever–that the company pays taxes before giving me the check, similar to what my take home pay on my check is–but then I started doubting myself when a friend advised me to make sure I wouldn’t have to pay taxes on it at the end of the year. Can someone please confirm?
relocation quote

Best answer:

Answer by swksmason
I think it means they paid you an extra amount to cover what you pay on the taxes. You will get a huge tax break for moving though, I think. I moved a few years back for a job and I had to claim every penny of the moving money. I am pretty sure “grossed up” means they paid the extra amount though?