5 CFR §550.1504

1. (a)An authorized agency official may, upon the request of a beneficiary, furnish one United States flag for an individual who—
   1. (1)Was an employee of the agency at the time of death; and
   2. (2)Died of injuries incurred in connection with such individual's employment with the Federal Government suffered as a result of—
      1. (i)A criminal act;
      2. (ii)An act of terrorism;
      3. (iii)A natural disaster; or
      4. (iv)Other circumstances, as determined by the President.
2. (b)An authorized agency official may not furnish a flag when the death is the result of—
   1. (1)Unlawful or negligent action of the employee;
   2. (2)Willful misconduct of the employee; or
   3. (3)Activities unrelated to the employee's status as a Federal employee.
3. (c)The decision whether to furnish a flag to the beneficiary of an eligible employee is at the discretion of the agency. When an authorized agency official determines the agency will furnish a flag for a deceased eligible employee, the official must follow the order of precedence specified in § 550.1505.