CRP Relocation Cost Management and Budgeting

Question 1

Which method of cost tracking assigns all relocation expenses to a single corporate cost center rather than the hiring business unit?

Accepted Answer

Centralized billing

Answer

Distributed charge-back

Answer

Direct billing

Answer

Lump sum allocation

Question 2

What is the primary purpose of a relocation cost estimate (RCE) prepared before an employee transfer is authorized?

Accepted Answer

To allow management to make an informed approval decision based on projected costs

Answer

To reimburse the employee upfront

Answer

To calculate the employee's tax gross-up

Answer

To determine the vendor's service fee

Question 3

A company uses a 'capped lump sum' for relocation. What does this mean?

Accepted Answer

The employee receives a flexible payment up to a defined maximum amount

Answer

The employee receives a fixed payment with no maximum limit

Answer

The company reimburses only actual receipted expenses

Answer

The company pays vendors directly with no employee involvement

Question 4

When benchmarking relocation program costs, which metric is most commonly used to compare spending across companies?

Accepted Answer

Average cost per relocating employee

Answer

Total program budget per fiscal year

Answer

Number of vendors under contract

Answer

Percentage of employees who decline offers

Question 5

Which type of relocation assignment typically results in the HIGHEST total cost to the employer?

Accepted Answer

International long-term assignment (1-3 years)

Answer

Local hire with no benefits

Answer

Domestic renter moving to a renter

Answer

Intern summer transfer

Question 6

What is 'tax gross-up' in the context of relocation cost management?

Accepted Answer

Additional compensation paid to cover the employee's income tax liability on taxable relocation benefits

Answer

A fee paid to the IRS for filing relocation returns

Answer

A penalty for exceeding the relocation budget

Answer

A surcharge added to vendor invoices

Question 7

Which relocation benefit is generally NOT taxable to the employee under current U.S. IRS rules (post-2017 Tax Cuts and Jobs Act)?

Accepted Answer

None — all relocation benefits became taxable after TCJA for non-military

Answer

Moving expense reimbursements for non-military employees

Answer

Qualified moving expense deductions for civilian employees

Answer

Employer-paid temporary housing allowances