B-236769, Feb 8, 1990

B-236769: Feb 8, 1990

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Wempe - Real Estate Expenses - Title Requirements: The issue in this decision is whether an employee may be reimbursed the total cost of real estate transaction expenses related to the sale of her residence where the employee held title to the property jointly with her nondependent sister. Was transferred from Kansas City. Title to the property was held by Ms. Wempe's sister had no ownership rights or monetary interest in the property and that the sister was to receive none of the proceeds from the sale of the property unless the sale occurred after Ms. We have consistently held that where an employee holds title to a residence with an individual who is not a member of her immediate family.

B-236769, Feb 8, 1990

CIVILIAN PERSONNEL - Relocation - Residence transaction expenses - reimbursement - Eligibility - Property titles DIGEST: A transferred employee who sold a residence at her old duty station which she owned jointly with her nondependent sister may be reimbursed only one- half of real estate expenses since nondependent sister does not qualify under the Federal Travel Regulations as member of the employee's "immediate family" for purposes of real estate expense reimbursement.

Denise M. Wempe - Real Estate Expenses - Title Requirements:

The issue in this decision is whether an employee may be reimbursed the total cost of real estate transaction expenses related to the sale of her residence where the employee held title to the property jointly with her nondependent sister. We conclude that the employee may be reimbursed only in the amount that corresponds to her interest in the property, or in this case 50 percent of the expenses.

Ms. Denise M. Wempe, an employee of the General Accounting Office, was transferred from Kansas City, Missouri, to Oklahoma City, Oklahoma, in January 1989. Ms. Wempe sold her residence at her former duty station. At the time of transfer, title to the property was held by Ms. Wempe and her nondependent sister, Michelle A. Smith, as joint tenants, by deed dated July 5, 1984. Ms. Wempe explains that her sister's name appeared on the title to the property so that in the event of her death her sister would be able to dispose of the property and distribute the proceeds of sale without the necessity of probate. Further, Ms. Wempe points out that her sister made no financial contributions toward the purchase at any time, and that Ms. Wempe reported all proceeds of the sale to the Internal Revenue Service while her sister reported none. Ms. Wempe also points out that in 1987 she and her sister prepared a notarized agreement stating that Ms. Wempe's sister had no ownership rights or monetary interest in the property and that the sister was to receive none of the proceeds from the sale of the property unless the sale occurred after Ms. Wempe's death in which case she would receive all of the sale proceeds. Ms. Wempe believes that under Missouri law her sister had no interest in the property even though her sister's name appeared on the deed.

Under the applicable statutory and regulatory provisions, we have consistently held that where an employee holds title to a residence with an individual who is not a member of her immediate family, the employee may be reimbursed only to the extent of her interest in that residence. Mazhar-Ul Haque, 68 Comp.Gen. 519 (1989); James A. Woods, B-184478, May 13, 1976. A nondependent sister does not qualify as an immediate family member under the regulatory definition.

We have reviewed the Missouri court decisions relied upon by Ms. Wempe but find that they do not support her position that her sister had no interest in the property. Moreover, we have identified additional Missouri court decisions which clearly would give effect to the deed in this case and thereby confirm that Ms. Smith held an undivided one-half interest by the terms of the deed of July 5, 1984. See Wilson v. Wilson, 642 S.W.2d 132 (Mo. App. 1982); Wingate v. Griffin, 610 S.W.2d 417 (Mo. App. 1980); Cave v. Cave, 593 S.W.2d 592 (Mo. App. 1979); and Jones v. Cox, 629 S.W.2d 511 (Mo. App. 1981).

Accordingly, since Ms. Wempe held title with an individual who was not a member of her immediate family, her reimbursement was correctly limited to her 50 percent interest. Her claim for additional reimbursement may not be allowed.