Claim for Reimbursement of Real Estate Expenses

GAO was asked whether closing costs paid by the seller above $500 may be reimbursed to a transferred employee who purchased a residence at his new duty station. A claim for real estate purchase expenses included in the purchase price and paid by the seller could be paid if itemized and otherwise properly documented. The employee contended that the closing costs were included in the total contract price of the house. The agency suggested that, since it is not customary for the seller to assume the closing costs ordinarily paid by the buyer, the seller's agreement to assume those costs necessarily reduced the price of the residence to an amount below the stated sales price. There was no indication in the sales contract that the closing costs assumed by the seller were included in the sales price nor was a statement to that effect submitted from the seller. As an employee is required to submit documentation to show that both the buyer and the seller regarded the closing costs to have been paid by the purchaser, GAO found that the employee may not be reimbursed for the closing costs in excess of $500, even though an agreement to pay part of the closing costs might have been taken into account by the seller in determining his selling price.