Charging Relocation to Externally Sponsored Projects [1]

Relocation expenses for post-docs, trainees, and students

Relocation expenses are not allowed on externally sponsored research awards for the above positions based on the cost principles. The University of Iowa’s relocation policy does not include payment for any position below P&S level 5 or equivalent.  Based on the University of Iowa’s policy it would be inconsistent to pay these costs from an externally sponsored project therefore they are considered unallowable. The treatment of direct and indirect costs is outlined in the US Office of Management and Budget’s Uniform Guidance.  This does not preclude the department or college from using non-fund 500/510 funds to pay for additional benefits. 

Relocation expenses for P&S level 5 (and above) or equivalent

Relocation costs are allowable as direct expenses if there is a permanent change of assignment of an existing employee or upon recruitment of a new employee. If the employee’s relocation directly benefits and is essential to the project(s), then the costs can be charged as direct expenses to the award(s).

Considerations when evaluating the allowability of relocation expenses include, but are not limited to the following:

• The work performed will directly benefit the objectives of the award
• Reimbursement to the employee is in accordance with University policies
• The reimbursement does not exceed the employee’s actual (or reasonably estimated) expenses
• International travel related to relocation on federally funded projects must adhere to the Fly America Act

The following costs related to relocation are unallowable:

• Fees and other costs associated with acquiring a new home.
• A loss on the sale of a former home.
• Continuing mortgage principal and interest payments on a home being sold.
• Income taxes paid by an employee related to reimbursed relocation costs.

Additionally, if relocation costs were charged directly to a federal award, but the newly hired employee resigns within 12 months of hire, the University of Iowa must refund or credit the federal share of those recruitment expenses.

** Please contact your grant accountant if you plan to use fund 500/510 for any relocation expenses.  This will ensure the costs are allowable. **

Last updated: 07/10/2025