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B-187890 1 (1977-02-17)

handle is hein.gao/gaobadeco0001 and id is 1 raw text is: W.11iam bbert '.0 fl~ 3Cir. Pern. . 'y THE COMPTROLLER WERAL. oC3CISION . OF THE UNITED *TATEU o 4 H WAUMIN3TON. C.C. ACo0 Iu 4 . FILE; B-187890 DATE; Februry 17,0 1977 MATTER OF: Michael R. Waldwyn - Real estate expenses - loan service fees DIGEST: Transferred employee incurred finance charge in form of closing ree expressed as 1 per- cent of purchase price of new residence. Although such service charge may not be deductible as interest for income tax purposes, employee may not be reimbursed service charge since it io regarded as a non-reimbursable finance charge unier Truth in Lending Act and Regulation Z. By a letter dated October 8, 1976, Mr. Michael R. Walowyn, an employee of the Federal Aviation Administration (FAA), has appealed the denial by our Claims Division of his claim rr reimbursement of residence transaction expenses incurred incident to a permanent change of station. The record indicates that p6rsua.nt to a travel cOrder dated July 2, 1974, Mr. Waldwyn was transfbrred from Hawthorne. Cali- fornia, to San Jc-e, California. In connection therewith, he purchased a resdience at his new duty station and incurred real estate expenses totaling $573.90, for which he claimed reimburse- ment from tne FAA. On July 11, 1975, the FAA disallowed payment of $430 on the basis that such amount was an unreimbursable finance charge. Mr. Waldwyn subsequently submitted to our Claims Division a claim in the amount of $430, representing the administratively disallowed charge. By Settlement Certificate No. Z-2631007, dated September 30, 1976, the Claims Division denied his claim on the grounds that under para. 2-6.2d of the Federal Travel Regulations (FPMR 101-7) .(May 1973), no fee, cost, charge, or expense is reimbursable which is determined to be part of the finance charge under the Truth in 'ending Act, Title I, Public Law 90-321, and Regulation Z issued pursuant thereto. Noting that decisions of this Office have held that a loan service charge or fee, not identified as being in payment of otherwise allowable expenses, is considered to be a finance charge, the Claims Division determined that in the absence oC itemization and id6ntification of allowable expenses, there was no basis to pay-any of Mr. Waldwyn's cla5. I

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