How does Microsoft relocation lump sum policy works? Is that being offered as an after-tax component? I was told by my recruiter that the relocation lump sum component is $15k and is after-tax and I don't have to pay a penny out of it as income tax but on the offer letter it was mentioned as, "A relocation lump sum allowance of $15,000.00 grossed up for taxes will be provided within your first month of employment (or transfer date) via payroll." This made me think that the relocation lump sum component is not after tax and it's pre-taxed but when I reached out to the recruiter again, she again confirmed that it's after-tax and asked me to not worry. Has anyone got relocation lump sum from Microsoft and can share how that really works? Or How this will work for me?
MSFT pays you the tax you will have to pay on the relocation upfront. For example if your relocation is $15K and the taxes are $5K, MSFT will give you $20K with your first pay check and you will pay the tax when you file your taxes.
But with the kind of statement on my offer letter (as indicated on the question), does that still mean that I will be paid $15k + taxes for my relocation? The term "grossed up for taxes" is confusing me.
Grossed up for taxes means 15k + the tax on it. So that you effectively get 15k. You won't even see the tax amount, they will pay it on your behalf and you will get 15k
Grossed up for taxes mean they’re covering the tax on the relocation. Otherwise you would only see about ~60% of 15k, instead now you will see exactly 15k in post tax dollars since msft will pay your taxes on it.
Oracle does that too! Company pays the tax and you get 15k in hand
$15k is after tax. You will get more cash to account for the tax!
Thank you all for clarifying!
In addition to cash do you get any other relocation assistance?
Yoe ?
It is after tax iirc