[Code of Federal Regulations]
[Title 41, Volume 4]
[Revised as of July 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 41CFR302-6.1]

[Page 156-160]
 
           TITLE 41--PUBLIC CONTRACTS AND PROPERTY MANAGEMENT
 
                   CHAPTER 302--RELOCATION ALLOWANCES
 
PART 302-6--ALLOWANCE FOR EXPENSES INCURRED IN CONNECTION WITH RESIDENCE TRANSACTIONS--Table of Contents
 
Sec. 302-6.1  Conditions and requirements under which allowances are payable.

    To the extent allowable under this part, the Government shall 
reimburse an employee for expenses required to be paid by him/her in 
connection with the sale of one residence at his/her old official 
station, for purchase (including construction) of one dwelling at his/
her new official station, or for the settlement of an unexpired lease 
involving his/her residence or a lot on which a mobile home used as his/
her residence was located at the old official station provided the 
conditions set forth in this section are met:
    (a) Transfers covered--agreement required. A permanent change of 
station is authorized or approved and, except as provided in paragraph 
(g) of this section, the old and new official stations are located 
within the United States, and the employee has signed an agreement as 
required in Sec. 302-1.5. (See exclusions in Sec. 302-6.4.)
    (b) Location and type of residence. The residence or dwelling is the 
residence as described in Sec. 302-1.4(k), which may be a mobile home 
and/or the lot on which such mobile home is located or will be located. 
These criteria also apply to the former nonforeign area official station 
residence of employees who are eligible for residence transaction 
expenses under paragraph (g) of this section (see definition in 
paragraph (g)(1)(i) of this section).
    (c) Title requirements. The title to the residence or dwelling at 
the old or new official station, or the interest in a cooperatively 
owned dwelling or in an unexpired lease, is in the name of the employee 
alone, or in the joint names of the employee and one or more members of 
his/her immediate family, or solely in the name of one or more members 
of his/her immediate family. The rules in paragraphs (c) (1) through

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(3) of this section apply in determining title to the residence.
    (1) Title interest must have been acquired prior to notification of 
transfer. For an employee to be eligible for reimbursement of the costs 
of selling a dwelling or terminating a lease at the old official 
station, the employee's property interest must have been acquired prior 
to the date the employee was first officially notified of his/her 
transfer to the new official station. In the case of an employee covered 
by paragraph (g) of this section, the employee's interest must have been 
acquired prior to the date the employee was first officially notified of 
his/her transfer to the foreign area.
    (2) Legal title interest. Except as provided in paragraph (c)(3) of 
this section, title to the residence is determined by the name of the 
party (or parties) on the title document (e.g., the deed).
    (3) Equitable title interest. The employee, and/or a member(s) of 
his/her immediate family, in a situation listed in paragraphs (c)(3) (i) 
through (v) of this section is deemed to have title to the residence 
without regard to whether his/her name appears on the title document.
    (i) Title held in trust. The property is held in trust and the 
conditions in paragraphs (c)(3)(i) (A) through (F) of this section 
apply.
    (A) The property must be the employee's residence as described in 
paragraph (b) of this section.
    (B) The employee and/or a member(s) of the immediate family must be 
the only beneficiary(ies) of the trust during his/her lifetime.
    (C) The employee and/or a member(s) of the immediate family must 
retain the right to distribute the property during his/her lifetime.
    (D) The employee and/or a member(s) of the immediate family must 
retain the right to manage the property.
    (E) The employee and/or a member(s) of the immediate family must be 
the only grantor/settlor of the trust, or must retain the right to 
direct distribution of the property upon dissolution of the trust or 
death.
    (F) The employee provides the agency with a copy of the trust 
document.
    (ii) Title held by financial institution. The title is held in the 
name of a financial institution and the conditions in paragraphs 
(c)(3)(ii) (A) through (D) of this section apply.
    (A) The property is the employee's residence as described in 
paragraph (b) of this section.
    (B) The employee and/or a member(s) of the immediate family executed 
a financing agreement (e.g., mortgage) with the financial institution.
    (C) State or local law requires that lending parties take title to 
perfect (i.e., protect) a security interest in the property, or the 
financial institution requires that it take possession of title as a 
condition of the financing agreement.
    (D) The employee must provide the agency with a copy of the 
financing document. The agency may require that the employee also 
provide proof of state or local laws governing secured credit.
    (iii) Title includes an accommodation party or parties. The title is 
held both in the names of: the employee singularly, or the employee and 
one or more members of his/her immediate family jointly, or one or more 
members of his/her immediate family; and an individual (accommodation 
party) who is not an immediate family member. In addition, the 
conditions in paragraphs (c)(3)(iii) (A) through (G) of this section 
apply. (An accommodation party is an individual who signs an employee's 
financing agreement (e.g., a mortgage) to lend his/her name (i.e., 
credit) to the arrangement.)
    (A) The property is the employee's residence as described in 
paragraph (b) of this section.
    (B) The employee and/or a member(s) of the immediate family has 
right to use the property and to direct conveyance of the property.
    (C) The lender requires signature of the accommodation party on the 
financing document.
    (D) The employee and/or a member of the immediate family, is liable 
for payments under the financing arrangement (e.g., mortgage).
    (E) The accommodation party's name is on the title.
    (F) The accommodation party does not have a financial interest in 
the

[[Page 158]]

property unless the employee and/or a member(s) of the immediate family 
defaults on the financing arrangement.
    (G) The employee provides the agency with acceptable documentation 
of the accommodation. Agencies shall issue policy defining acceptable 
documentation of the accommodation. Such documentation may include a 
copy of the financing document and/or a written statement from the 
employee certifying that the conditions in paragraphs (c)(3)(iii) (A) 
through (G) of this section apply. Such documentation also may include a 
written statement from the accommodation party certifying that he/she 
does not have a financial interest in the property.
    (iv) Title held by seller of the property. The title is held in the 
name of the seller of the property and the conditions in paragraphs 
(c)(3)(iv) (A) through (D) of this section apply.
    (A) The property is the employee's residence as described in 
paragraph (b) of this section.
    (B) The employee and/or a member(s) of the immediate family has 
right to use the property and to direct conveyance of the property.
    (C) The employee and/or a member(s) of the immediate family must 
have signed a financing agreement with the seller of the property (e.g., 
a land contract) providing for fixed periodic payments and transfer of 
title to the employee and/or a member(s) of the immediate family upon 
completion of the payment schedule.
    (D) The employee must provide the agency with a copy of the 
financing agreement.
    (v) Other equitable title situations. The title is held both in the 
names of: the employee singularly, or the employee and one or more 
members of his/her immediate family jointly, or one or more members of 
his/her immediate family; and an individual who is not an immediate 
family member. In addition, the conditions in paragraphs (c)(3)(v) (A) 
through (E) of this section apply.
    (A) The property is the employee's residence as described in 
paragraph (b) of this section.
    (B) The employee and/or a member(s) of the immediate family has 
right to use the property and to direct conveyance of the property.
    (C) Only the employee and/or a member(s) of the immediate family has 
made payments on the property.
    (D) The employee and/or a member(s) of the immediate family received 
all proceeds from the sale of the property.
    (E) The employee must provide suitable documentation to the agency 
that the conditions listed in paragraphs (c)(3)(v) (A) through (D) of 
this section have been met. Agencies shall issue policy defining 
acceptable documentation. Such documentation must include financial 
documents proving that only the employee and/or a member(s) of the 
immediate family made payments on the property, and financial documents 
proving that the employee and/or a member(s) of the immediate family 
received all proceeds from the sale of the property.
    (d) Occupancy requirements. The dwelling for which reimbursement of 
selling expenses is claimed was, except as provided in paragraph (g) of 
this section, the employee's residence at the time he/she was first 
officially notified by competent authority of his/her transfer to the 
new official station.
    (e) Time limitation--(1) Initial period. The settlement dates for 
the sale and purchase or lease termination transactions for which 
reimbursement is requested are not later than 2 years after the date 
that the employee reported for duty at the new official station. For 
employees eligible under paragraph (g) of this section, new official 
station means the official station to which the employee reports for 
duty when reassigned or transferred from a foreign area.
    (2) Extension of time limitation. (i) Upon an employee's written 
request, the 2-year time limitation for completion of the sale and 
purchase or lease termination transactions may be extended by the head 
of the agency or his/her designee for an additional period of time not 
to exceed 1 year.
    (ii) The employee's written request should be submitted to the 
appropriate agency official(s) as soon as the employee becomes aware of 
the need for an extension but before expiration of the 2-year 
limitation; however, in no case shall the request be submitted later 
than 30 calendar days after the

[[Page 159]]

expiration date unless this 30-day period is specifically extended by 
the agency.
    (iii) Approval of this additional period of time shall be based on a 
determination that extenuating circumstances, acceptable to the agency 
concerned, have prevented the employee from completing the sale and 
purchase or lease termination transactions in the initial timeframe and 
that the residence transactions are reasonably related to the transfer 
of official station.
    (iv) When an employee is eligible for an extension of the time 
limitations for completion of a residence transaction and such an 
extension is approved by an agency, relocation entitlements and 
allowances shall be determined by using the entitlements and allowances 
prescribed by regulations in effect on the employee's effective date of 
transfer and not the entitlements and allowances in effect at the time 
the extension of the time limitation is approved. (See Sec. 302-1.3(d).)
    (f) Reimbursement of expenses. The rules in paragraphs (f) (1) and 
(2) of this section govern the reimbursement of employee residence 
transaction expenses.
    (1) Employee must actually incur the expenses. An employee shall be 
reimbursed only for expenses actually incurred and paid by the employee 
or a member of the employee's immediate family. If any expenses were 
shared by persons other than the employee or a member of his/her 
immediate family, reimbursement is limited to the portion actually paid 
by the employee and/or a member of his/her immediate family.
    (2) Pro rata reimbursement. When the title possessed by an employee 
and/or a member(s) of his/her immediate family is not full title to the 
residence, or when an employee is deemed to have a title interest under 
paragraph (c)(3) of this section, the employee shall be reimbursed on a 
pro rata basis to the extent of his/her actual title interest plus his/
her deemed title interest in the residence. Additionally, an employee 
shall be reimbursed on a pro rata basis in the situations listed in 
paragraphs (f)(2) (i) and (ii) of this section.
    (i) Multiple occupancy dwelling. If the residence is a duplex or 
another type of multiple occupancy dwelling which is occupied only 
partially by the employee, or whenever the employee shares 
responsibility for a leased property (e.g., a shared apartment 
arrangement), expenses shall be reimbursed on a pro rata basis.
    (ii) Excess land. The employee shall be limited to pro rata 
reimbursement when he/she sells or purchases land in excess of that 
which reasonably relates to the residence site.
    (g) Transfer from a foreign area to a nonforeign area--(1) 
Definitions. For purposes of this paragraph, the following definitions 
apply:
    (i) Former nonforeign area official station. This term means the 
official station from which the employee was transferred when assigned 
to the post of duty in the foreign area.
    (ii) Nonforeign area. Nonforeign area includes the United States.
    (iii) Foreign area. Foreign area refers to any area not defined as a 
nonforeign area.
    (2) Applicability. The provisions of this part are applicable, as 
specified in this paragraph, to employees who have completed an agreed 
upon tour of duty in a foreign area and instead of being returned to the 
former nonforeign area official station, are reassigned or transferred 
in the interest of the Government to a different nonforeign area 
official station than the official station from which the employee was 
transferred when assigned to the foreign post of duty. The distance 
between the former and new official stations must meet the mileage 
criteria specified in Sec. 302-1.7 for short distance transfers.
    (3) Authorized reimbursement. Generally, an employee is required to 
serve at least one tour of duty in a foreign area and retain a residence 
in a nonforeign area with the expectation of returning to the former 
official station in the nonforeign area. However, there are instances 
when an employee completes a tour of duty in a foreign area and is 
subsequently transferred to a different official station or post of duty 
in a nonforeign area than the one from which he/she transferred when 
assigned to the foreign post of duty. When this

[[Page 160]]

type of transfer is authorized or approved, reimbursement is allowable 
for real estate expenses required to be paid by the employee in 
connection with:
    (i) The sale of the residence (or the settlement of an unexpired 
lease) at the official station from which the employee was transferred 
when he/she was assigned to a post of duty located in a foreign area; 
and
    (ii) The purchase of a residence at the new official station when 
the employee is transferred in the interest of the Government from a 
post of duty located in a foreign area to a nonforeign area official 
station (other than the official station from which he/she was 
transferred when assigned to the foreign post of duty).
    (4) Reimbursement limitations. Reimbursement under this paragraph is 
prohibited for any sale (or settlement of an unexpired lease) or 
purchase transaction that occurs prior to the employee's first being 
officially notified (generally in the form of a change of official 
station travel authorization) that instead of returning to the former 
nonforeign area official station, he/she will be reassigned or 
transferred to a different nonforeign area official station than the one 
from which he/she was transferred when assigned to the foreign post of 
duty.
    (5) Service agreement required. A signed service agreement shall be 
required as prescribed in Sec. 302-1.5 for any employee who is eligible 
for reimbursement of residence transaction expenses authorized under 
this paragraph.

[54 FR 20321, May 10, 1989, as amended by FTR Amdt. 2, 54 FR 37811, 
Sept. 13, 1989; 54 FR 43521, Oct. 25, 1989; FTR Amdt. 10, 55 FR 41538, 
Oct. 12, 1990; FTR Amdt. 17, 56 FR 23658, May 23, 1991; 56 FR 29439, 
June 27, 1991; FTR Amdt. 26, 57 FR 28635, June 26, 1992; FTR Amdt. 37, 
59 FR 27489, May 27, 1994; FTR Amdt. 62, 62 FR 13765, Mar. 21, 1997; FTR 
Amdt. 84, 64 FR 29163, May 28, 1999]