U.S. Domestic Relocation Definitions

Appraised Value – The anticipated sales price of an employee’s origin home, typically established by two or three independent, fee-paid appraisals. The value is established based on the client’s relocation policy.

Area Orientation Services – Typically “on the ground” services to a relocating family providing area tours and information, lifestyle issues, and other concerns in the new area.

Broker’s Market Analysis (BMA) or Broker’s Price Opinion (BPO) – General terminology used by real estate brokers/agents and relocation management companies referring to the agent’s written market analysis. The report reflects recent comparable sales and listings with recommendations for a marketing strategy, suggested list price, and most likely sales price.

Buyer’s Value Option (BVO) – A relocation transaction in which the employee markets their origin property with a marketing assistance program until a bona fide contract has been obtained from an outside buyer. Once the title is clear, and inspection items have been resolved, the relocation management company “mirrors” the outside offer and subsequently purchases the property from the employee, disbursing any equity to the employee, then closes with the outside buyer thereby creating two independent transactions.

Cost-of-Living Allowance (COLA) – An allowance intended to assist an employee who is moving to a higher cost-of-living area. COLA expenses are typically provided for a specific period.

Destination Services – A wide variety of services are provided to relocating employees and families at the location where they are moving. These may include home-finding, area counseling, mortgage counseling, rental assistance, temporary housing, spouse-employment assistance, and new home inspections.

Direct Reimbursement Program – This is a type of home sale program in which the employee markets the origin home through the marketing assistance program, secures a purchaser, and subsequently closes the outside sale. Once the closing occurs, the employee submits the settlement document for reimbursement of approved closing costs which typically include the real estate commission and non-recurring closing costs.

Directed Offers – An offer to purchase the employee’s origin home in which the company has directed an offer for the property based on other items than the average of two independent fee-paid appraisals, usually for an amount that is higher than the anticipated selling price of the property.

Gross-up – Company-provided tax assistance which offsets, in whole or in part, the effect that certain taxable, nondeductible reimbursements or allowances may have on an employee’s gross income.

Guaranteed Offer – The “appraised value” offer made by the relocation management company or the employer to purchase an employee’s principal residence at origin. Based on the company’s policy, this may be based on the average of two or three independent fee-paid appraisals, typically with a fixed acceptance period.

Home Finding Trip – A home or apartment search in the destination location, based on an employee and family’s requirements and preferences.

Home Selling Expenses – Expenses arising out of the sale of real estate such as brokers commission, transfer taxes, attorney and inspection fees, deed and recording fees, escrow or abstract fees, mortgage prepayment penalties, and incentives paid by the seller.

Household Goods Transportation Insurance – Insurance provided for household goods being packed, in transit, held in storage, or unpacked.

Storage – Placement of household goods in either short- or long-term storage facilities, typically in the destination location. Storage up to 30 days is considered excludable from income by the IRS; more than 30 days is taxable.

Tax Assistance – A payment by a corporation to an employee in recognition of the fact that many of the payments associated with relocation are considered income to the employee and thus taxable. This payment, commonly called gross-up, is also taxable, may pay for all or part of the additional taxes incurred.

Temporary Housing – Living quarters provided for an employee for a specific period of time upon beginning work at the new location prior to the final move.

International Mobility Definitions

Assignment: The relocation of an employee, whether short or long term, to a host location for a specific business need and period of time.

Cost of Living: The costs of defined goods and services required for living in a specific location to determine the cost of living potentially deeming a Cost-of-Living Allowance (COLA) necessary.

Cross-cultural Training Services: Orientation and training programs for employees and their families to familiarize them with living and working environments in a particular location and culture. Programs may include value systems, behaviors, business and social protocol, and emotional transition and strategies for success in the new culture.

Host Housing: Housing, whether temporary or permanent, in the host location in which the employee and family members will reside while on assignment.

Household Goods Shipment: Transportation and insurance of an employee’s household goods and personal effects via air or surface shipment from the home location to the host location.

Household Goods Storage: Long- or short-term storage of employee’s personal goods while on assignment or in temporary housing.

Immigration: The securing of a host country visa, work permit, and/or residence permit by an employee and their dependent family members.

Long Term Assignment: The temporary assignment of an employee for a period of one to five years where family members may or may not accompany the employee.

Property Management Services: During the assignment, an employee may elect to maintain the home and contract with a property management company to manage the home during their assignment for services such as property maintenance and securing and management of tenants.

Relocation Allowance: An allowance to cover moving expenses not otherwise covered by policy benefits. Receipts are not needed nor is any documentation of how the allowance is used.

Repatriation: The return of the employee to the home country at the completion of the assignment.

Settling-in Services: A service provided by a destination service provider, or local agent, to assist the employee in securing a driver’s license, setting up bank accounts, securing transportation, area orientation, utility hook-up, etc.

Short Term Assignment: The temporary assignment of an employee is projected to last for a period of three to twelve months from their home country to a host country.

Temporary Accommodations: Furnished, short-term housing that an employee may utilize for assignments of less than 12 months or for longer assignments, for their initial arrival or upon their return.

Visa: A document that grants the employee permission to enter a country for a specified length of time which may or may not permit the expatriate to work and may require a separate application for a work permit.

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