Orders came through. You have a report date, a pack-out to schedule, and a house in Lexington Park, California, Great Mills, or somewhere else in St. Mary’s County that has to be dealt with before you go, or after you’re already gone.
Lots of military families around Naval Air Station Patuxent River go through this every PCS season. This guide walks you through the decisions in order: whether to sell or rent, a timeline that works backward from your report date, the money issues people tend to find out about too late, and how to close from somewhere else.
General information only. For your situation, check the official IRS, Maryland Comptroller, VA, and SCRA sources linked at the end, or the NAS Patuxent River Housing Service Center / installation legal office.
Step 1: Decide Whether to Sell or Rent
Plenty of Pax River families keep their house as a rental, and for some it works out well. Before you make that call, be honest with yourself about these questions:
- Will the rent cover the mortgage, taxes, insurance, repairs, and a property manager? Managing a rental in Southern Maryland from another duty station almost always means paying a manager.
- Are you ready for the problems that come up? Vacancies, late rent, and damage don’t wait for a convenient time. (Our post on signs it’s time to sell an investment property covers the warning signs.)
- How long can you rent it and still get the tax break? See Step 4. Renting for too long can cost you the capital gains exclusion.
- Do you need your VA entitlement for your next home? See Step 4 for this one too.
If the numbers are tight, or you just don’t want to be a landlord from three time zones away, selling is usually the cleaner choice.
Step 2: Build a Timeline Backward From Your Report Date
A regular financed sale goes through listing, showings, a contract, a home inspection, an appraisal, and the buyer’s loan approval before you get to settlement. Each of those steps takes time, so start as soon as your orders look likely.
A practical sequence:
- As soon as orders look likely: Get a value estimate and a net sheet (what you’d actually walk away with). Decide whether to sell or rent.
- Pick your pack-out date: Decide whether the house sells empty (after the movers leave) or furnished (before). Empty houses are easier to show remotely, but the house sits vacant while it’s for sale.
- Repairs and prep: Choose between fixing items before listing and selling as-is. Repairs mean managing contractors, which gets harder once you’ve left.
- Under contract: Line up someone local (an agent, a friend, or the buyer) to let in inspectors and appraisers.
- Before settlement: Get the tax and VA paperwork in Step 4 started early.
- Settlement: Sign in person or remotely (Step 5).
Also keep in mind that PCS season tends to cluster in the summer, so movers, title companies, and buyers can all be busier then.
Step 3: If You Rent Now, Know Your SCRA Lease Rights
If you’re renting in St. Mary’s County rather than owning, the Servicemembers Civil Relief Act (50 U.S.C. §3955) lets you end a residential lease after you receive PCS orders, or deployment orders for 90 days or more. You give the landlord written notice and a copy of your orders. For a lease with monthly rent, the termination takes effect 30 days after the next rent due date following delivery of the notice. Military OneSource explains the details, and the NAS Patuxent River Housing Service Center (Bldg. 2371, 21967 Cuddihy Rd., 301-342-3846) can help with housing questions.
Step 4: The Money Details People Learn Too Late
Capital gains: the military suspension
Normally, to exclude a gain on a home sale you must have owned and lived in the home for two of the five years before the sale. IRS Publication 523 lets members of the uniformed services on qualified official extended duty suspend that five-year period for up to 10 years. That can matter a lot if you rented the house out after an earlier PCS. Review Pub. 523 against your ownership and use dates (and any periods of nonqualified use).
Maryland withholding for nonresident sellers
If you aren’t a Maryland resident when you sell (for example, your state of legal residence is somewhere else, which is common for service members), Maryland may require part of the proceeds to be withheld at settlement. The closing agent reports and remits that withholding on Form MW506NRS (Return of Income Tax Withholding for Nonresident Sale of Real Property).
To request a full or partial exemption — or a reduced withholding amount — from the Comptroller before closing, file Form MW506AE (Application for Certificate of Full or Partial Exemption). The Comptroller says the application must be received at least 21 days before the settlement date. In some cases a Maryland-resident or principal-residence certification on the deed can also remove the requirement; your title company can tell you which path fits. Bring this up with your title company as soon as you’re under contract. Forms and instructions are on the Comptroller of Maryland site.
Restoring your VA loan entitlement
If you bought with a VA loan, selling the house and paying off the loan generally lets you ask the VA to restore your entitlement so you can use it again at your next duty station. You can request restoration with VA Form 26-1880 or through the VA’s online Certificate of Eligibility process. If you keep the house as a rental, part of your entitlement usually stays tied up (with limited one-time restoration options described on VA.gov).
Step 5: Closing After You’ve Already Left
You don’t have to be in Southern Maryland to close:
- Mail-away or remote closing. Ask your settlement company early how they’ll get you the documents, especially if you’ll be overseas.
- Power of attorney. If you might be deployed or hard to reach, the installation legal office can help, but first confirm the exact POA form the title company will accept.
- Someone local for access. A spouse who stays behind, a friend, a property manager, or the buyer can handle walkthroughs.
Step 6: Choose How to Sell
Listing with an agent usually gets the highest price when the house shows well and you have time for a financed buyer to close.
Selling directly to a local buyer trades some price for certainty and speed. You don’t make repairs, you don’t do showings while you’re out-processing, and you pick a closing date that fits your report date. It’s often the better fit when:
- your report date is close,
- the house needs work you can’t manage from far away,
- you already moved and are paying two housing costs, or
- you rented it out and now have tenants in place (we buy tenant-occupied houses).
We buy houses all over St. Mary’s County, including Lexington Park and California, and we’re used to working around report dates. If you’re a civilian or contractor relocating instead of PCSing, our relocation guide covers your situation.
Quick PCS Selling Checklist
- ☐ Value estimate and net sheet
- ☐ Decide whether to rent or sell
- ☐ Pack-out date set
- ☐ Decide on repairs vs. as-is
- ☐ Title company told about remote closing and nonresident withholding (MW506AE / MW506NRS)
- ☐ POA prepared (if needed)
- ☐ VA entitlement restoration requested after payoff
- ☐ Capital gains ownership/use dates checked against IRS Pub. 523
Get a No-Obligation Offer on Your Timeline
Southern Maryland Home Buyers is a local company led by Steve Cavanaugh, buying houses in St. Mary’s, Charles, and Calvert counties. Tell us your report date and we’ll tell you what we can do. Call (240) 523-3730 or fill out the short form. You can also see how our process works.
Sources:
- 50 U.S.C. §3955 — Termination of residential or motor vehicle leases
- Military OneSource — Military Lease Termination Under the SCRA
- IRS Publication 523 — Selling Your Home
- IRS Topic No. 701 — Sale of your home (military suspension summary)
- Comptroller of Maryland — Form MW506NRS (withholding return at closing)
- Comptroller of Maryland — Form MW506AE (application for full/partial exemption certificate; file ≥21 days before closing)
- Maryland withholding requirements overview (PDF)
- VA — Eligibility for VA home loan programs (entitlement restoration)
- VA Form 26-1880