Revenue Ruling #2005-74

In Rev. Rul. 2005-74, 2005-2 CB 1153, the Service rejected its examiners’ reliance on Amdahl in the most common relocation home purchase programs, holding that in such programs ownership is transferred from the employee to the employer, through a relocation company acting as the employer’s agent, in a bona fide sale. The ruling holds that in those fact situations the employer’s expenses associated with the purchase and sale are not taxable to the employee as wages, and provides helpful guidance as to procedures that will avoid taxability of the expenses to the employee.