USE OF A RELOCATION SERVICES COMPANY

• Citation: 41 CFR Part 302-12
• Sections: 10

§ 302-12.1 Determining use of an RSC.

Agencies determine whether an employee may use an RSC, choose which RSC they may use, and determine the contract terms to which they will be required to agree.

§ 302-12.2 Homesale participation requirements.

(a) Employees are required to participate in homesale counseling if they are going to use the RSC. The RSC and/or the agency must provide counseling to help employees understand the process, select a broker, prepare the home for sale, identify an appropriate selling price, set realistic expectations, etc.

(b) Employees are not required to accept a buyout offer from the RSC. Agencies must give employees the option to accept or reject an offer from the relocation services company.

§ 302-12.3 Relocation services expenses an agency will pay.

(a) Agencies will pay the relocation services company's fees/expenses for the services employees are authorized to use. If an agency pays the relocation services company for actual expenses the company incurs on an employee's behalf, payment to the company is limited to what the employee would have received under the direct reimbursement provisions of this chapter.

(b) If an employee uses a relocation services company to sell or purchase a residence for which the employee and/or a member(s) of their immediate family do not have full title, the agency will pay the portion of the relocation services company's fee attributable to the employee's pro rata share of the residence, in accordance with § 302-11.100 of this subchapter. Employees must pay any portion of the fee attributable to other than the pro rata share of the residence.

(c) If an employee uses a contracted-for relocation service ( i.e., a relocation service provided and handled directly by an RSC) that is a substitute for a reimbursable relocation allowance, the employee will not also be reimbursed for that relocation allowance. Employees must choose either the service or reimbursement, but not both.

§ 302-12.4 Expenses paid if using an RSC to ship household goods in excess of the maximum weight allowance.

If an employee uses a relocation services company to ship HHG in excess of the maximum weight allowance, the agency will pay the portion of the fee attributable to 18,000 pounds net weight. Employees must pay the rest.

§ 302-12.5 Income tax consequences for use of an RSC.

Employees may incur income taxes on relocation services provided by a relocation services company and paid for by their agency. Section 82 of the Internal Revenue Code states there shall be included in gross income (as compensation for services) any amount received or accrued, directly or indirectly, by an individual as a payment for or reimbursement of expenses of moving from one residence to another residence which is attributable to employment. Employees will receive a relocation income tax allowance (RITA) if their agency determines that such expenses are taxable. The Government does not assume responsibility for payment of an employee's taxes.

§ 302-12.100 Contracting for “relocation services” with an RSC.

(a) Agencies may enter into a contract with a relocation services company for the company to provide relocation services. “Relocation services” are services provided by a private company under a contract with an agency to assist an employee who relocates. Examples include homesale programs, home marketing assistance, home finding assistance, household goods management services, and property management services. Agencies may pay for contracted relocation services that are substitutes for reimbursable relocation allowances authorized throughout this chapter.

(b) Agencies may separately contract for each type of relocation service or they may combine several types of relocation services in a single contract.

§ 302-12.101 Rules to follow when contracting for relocation services.

When contracting for relocation services, agencies must follow the rules contained in the Federal Acquisition Regulation (FAR) (48 CFR) and/or all other acquisition regulations applicable to their agency.

§ 302-12.102 Policies to establish when offering employees the services of an RSC.

If an agency chooses to offer the services of an RSC to their employees, the agency must establish policies governing:

(a) The conditions under which the agency will authorize an employee to use the contract with the RSC;

(b) Which employees the agency will allow to use the contract with the RSC;

(c) Which services the RSC will provide to the employee;

(d) Who will determine in each case if an employee may use the contract with the RSC and which services the RSC will provide;

(e) How the agency will monitor and evaluate the counseling provided by the agency and/or the RSC to their employees; and

(f) How the agency will monitor and maintain an appropriate balance between the types of homesale transactions in the homesale programs.

§ 302-12.103 Taking title to an employee's residence.

Agencies may not take title to an employee's residence except as specifically provided by statute. The statutes which form the basis for the provisions of this part do not provide such authority.

§ 302-12.104 Paying an employee for losses incurred on the sale of a residence.

Under a home sale program, agencies may not pay an employee for losses incurred on the sale of a residence, but this does not preclude an agency reimbursing a relocation services company for losses incurred while the contractor holds the property.