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B-198901 1 (1980-10-03)

handle is hein.gao/gaobadipg0001 and id is 1 raw text is: a L LR THE COMPTROLLER GENERAL DECISION OF THE UNITED STATES VWASHINGTON. D. C. 20548 FILE: B-198901 DATE: October 3, 1980 MATTER OF: Martin L. Berdan - Real Estate Expenses/.4eb'b/i 1040) Commitment F DIGEST: Federal employee, upon transfer, paid 3/4 of 1 percent of the amount of a loan on purchase of a residence as a commitment fee to the lending institution. Commitment fee is a finance charge within the definition of that term in section 106(a) of the Truth in Lending Act and thus not reimbursable under Federal Travel Regulations, para. 2-6.2d (May 1973). The issue presented in this case upon a egiuest from an p authorized certifying officer of the Internal Rerenu ervice X2. is whether a loan commitment fee paid by a Federal employee on purchase of a residence upon transfer may be reimbursed. Since the commitment fee is a finance charge within the definition of that term in section 106(a) of the Truth in Lending Act, it is not reimbursable under Federal Travel Regulations, para. 2-6.2d (May 1973). Mr. Martin L. Berdan, an employee of the Internal Revenue Service, was authorized to incur expenses on the purchase of a residence in connection with a transfer of official duty station from Champaign, Illinois, to Waco, Texas. Mr. Berdan submitted a voucher claiming reimbursement of $345 for a commitment fee which he paid to the lending institution. The loan disclosure statement shows that the commitment fee represented 3/4 of 1 percent of the loan which was in the amount of $46,000. In addition the statement shows that no loan origination fee was charged to the buyer. Mr. Berdan asserts that the lending institution takes the position that the commitment fee is not a finance charge and since the Internal Revenue Service does not allow a deduction of this item as an interest expense under the tax code, it should be reimbursable to him as a miscellaneous expense incident to his transfer to Texas. Authority to reimburse a Government incurred in connection with the purchase official transfer of station is found in .1 '1 employee for expenses of a residence upon 5 U.S.C. § 5724a (1976). die / - / 7 3-

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