[Claims for Relocation Income Tax Allowances for Employees Transferred to Virgin Islands and Puerto Rico]

The Department of Agriculture (USDA) requested a decision concerning claims for reimbursement of relocation income tax (RIT) expenses that certain employees incurred as a result of transfers to the Virgin Islands and Puerto Rico. GAO held that: (1) since statutory law authorized reimbursement for almost all of the applicable relocation expenses for transfers to U.S. territories, possessions, or Puerto Rico, the employees were entitled to reimbursement for the allowance; and (2) the tax rate for U.S possessions and Puerto Rico parallelled the federal tax rate. Accordingly, USDA should pay the claims after the General Services Administration has established an applicable marginal tax.