Source: http://districtre.com/tools-2-use/dc-recordation-and-transfer-tax/
Timestamp: 2018-07-23 07:25:51
Document Index: 562791319

Matched Legal Cases: ['§ 47', '§ 47', '§ 47', '§ 47', '§ 32', '§ 42', '§ 47', '§ 47', '§ 47', '§ 47', '§ 47', '§ 47', '§ 22', '§ 47', '§ 29', '§ 42', '§\u20021614', '§\u20021382', '§ 47', '§ 47', '§\u200947', '§ 19', '§ 34', '§ 42']

DC Recordation and Transfer Tax - Who pays and who doesn't
Recordation & Transfer Tax in Washington DC
Costs, discounts and exemptions for DC tax stamps
What is DC recordation and transfer tax?
Parties transferring real estate typically pay a tax to states and local entities such as cities and counties. The DC recordation and transfer tax fees are among the highest individual closing costs related to your real estate transaction.
As part of the sale or transfer of DC property, the Office of Tax and Revenue and Recorder of Deeds impose both when transferring and recording the deed.
How much are recordation and transfer taxes?
District of Columbia taxes are based on the value of consideration given (purchase price) for the property. Where there is no consideration or where the consideration is nominal, the tax is imposed on the basis of the fair market value of the property. Your settlement agent will use Form FP 7/C to calculate the taxes, it is signed by buyer and seller, notarized at settlement and recorded by the recorder of deeds along with the deed and deed of trust.
District of Columbia Deed Recordation Tax applies to all deeds to real estate. The tax is based on the value of consideration given for the property. Where there is no consideration or where the consideration is nominal, the tax is imposed on the basis of the fair market value of the property. The 2017 rate is 1.1 % of consideration or fair market value for residential property transfers less than $400,000 and 1.45% of consideration or fair market value on the entire amount, if transfer is greater than $400,000.
In Washington DC, Deed Transfer Tax is based on the consideration paid for the transfer. Where there is no consideration or where the amount is nominal, transfer tax is the fair market value of the property being conveyed. The 2017 rate is 1.1 % of consideration or fair market value for residential property transfers less than $400,000 and 1.45% of consideration or fair market value on the entire amount, if transfer is greater than $400,000.
The seller often pays the transfer tax and recordation tax is paid by the buyer, however this can be negotiated. In the 2017 GCAAR purchase contract, the typical arrangement cited above is the case unless an alternate arrangement is agreed to by the parties as part of the written agreement. New construction contracts can vary by developer and project. Often, the developer will tie payment of the transfer tax to the buyer’s use of the developer’s title company and lender, so it’s important to read contract provisions relating to DC recordation and transfer tax carefully before singing,
All real property, unless expressly exempted, is subject to the real property tax, which is assessed at 100% of market value. The District of Columbia has four property classes:
Class 1 – improved residential real property that is occupied and is used exclusively for nontransient residential dwelling purposes
Class 2 – Commercial property (2 classes)
Class 3 – Vacant property
Class 4 – Blighted property
Is anyone exempt from DC recordation and transfer tax?
There are quite a large number of qualifying circumstances for reduction of, or exemption from DC recordation and transfer tax, including the District’s recent inclusion of a first-time homebuyer reduction and revised rules for those with interests in cooperative units:
2017: The recordation tax for qualifying first-time homebuyers purchasing homes for a price that does not exceed $625,000 is reduced from the general rate of 1.45% to .725%. This applies to deeds recorded on or after October 1, 2017;
DC’s § 47–3503. Exemptions for qualifying lower income homeownership households and cooperative housing associations;
Deeds to property acquired by the United States of America or the District of Columbia, unless its taxation has been authorized by Congress are exempted. Here is the form;
Deeds to real property acquired by an institution, organization, corporation, or government entitled to exemption from real property taxation under § 47-1002 (or exempt from recordation taxes under a law of the United States of America or the District of Columbia); provided, that, unless waived by regulation, a copy of a filed real property tax exemption application accompanies the deed at the time of recordation; provided further, that this exemption shall not apply to property which is exempt under § 47-1002 or § 47-1002;
Deeds to property acquired by an institution, organization, corporation, or association entitled to exemption from real property taxation by special act of Congress, which property was acquired solely for a purpose or purposes for which such special exemption was granted; provided, that a return, under oath, showing the purpose or purposes for which such property was acquired, shall accompany the deed at the time of its offer for recordation;
A purchase money mortgage or purchase money deed of trust that is recorded simultaneously with the deed conveying the real property for which the purchase money mortgage or purchase money deed of trust was obtained;
Supplemental deeds;
Deeds between spouses, parent and child, grandparent and grandchild, or domestic partners, as defined in § 32-701(3), without actual consideration therefor;
Deeds of personal representatives of decedents, acting under the provisions of Title 20, transferring to a distributee, without additional consideration, real property of a decedent or a life estate in the real property;
When a permanent loan deed of trust or mortgage is submitted for recordation and the tax on the construction loan deed of trust or mortgage has been timely and properly paid, no additional tax liability arises under § 42-1103, except where the amount of the obligor’s liability secured by the permanent loan deed of trust or mortgage exceeds the amount of his liability secured by the construction loan deed of trust or mortgage, in which case the tax shall be calculated only on the amount of such difference; provided, however, that such permanent loan deed of trust or mortgage shall contain a reference to the construction loan deed of trust or mortgage and the date and instrument number where it is recorded;
Deeds to property transferred to a qualifying lower income homeownership household in accordance with § 47-3503(a);
Deeds to property transferred to a qualifying nonprofit housing organization in accordance with § 47-3505(c);
Deeds to property transferred to a cooperative housing association in accordance with § 47-3503(a)(2);
Construction loan deeds of trust or mortgages or permanent loan deeds of trust or mortgages in accordance with § 47-3503(a)(3);
A deed by a transferor that conveys bare legal title to the trustee of a revocable trust, without consideration for the transfer, where the transferor is the beneficiary of the trust;
A deed to property transferred to a beneficiary of a revocable trust as the result of the death of the grantor of the revocable trust;
A deed to property transferred by the trustee of a revocable trust if the transfer would otherwise be exempt under this section if made by the grantor of the revocable trust;
A deed to property transferred to a resident management corporation in accordance with § 47-3506.01;
A security interest instrument in Class 1 Property, as that class of property is established pursuant to § 47-813(c-4), that contains no more than 5 dwelling units. Each security interest instrument submitted for recordation for which an exemption under this paragraph is claimed shall have affixed thereto an affidavit stating the following: “I (we) the owner(s) of the real property described within certify, subject to criminal penalties for making false statements pursuant to § 22-2405 of the District of Columbia Code , that the real property described within is Class 1 Property, as that class of property is established pursuant to § 47-813(c-4), with 5 or fewer units.”;
A deed to property transferred pursuant to § 29-204.06;
In order for limited liability companies to receive the exemption provided in subparagraph (A) of this paragraph, the Recorder of Deeds shall be notified, within 30 days, of any change to the members or interests in profits and losses during the 12-month period following the effective date of the conversion so that the applicable recordation tax can be imposed;
Violation of the provisions of subparagraph (B) of this paragraph shall be punishable pursuant to § 42-1120 [repealed];
A deed for the improvements known as the District of Columbia Correctional Treatment Facility, located on a portion of Lot 800 of Square 1112E, with a street address of 1901 E Street, S.E.;
Deeds conveying, vesting, granting, or assigning title to, an interest in, a security interest in, or an economic interest in the real property (and any improvements thereon) described as Square 454, Lots 41, 824, 838, 857, 877, 878; the portion of the public alley that reverted to (i) former Lot 820, (which is currently known as Lot 866), and (ii) former Lot 821 (which is currently known as Lot 867) pursuant to the Plat of Alley Closing filed with the Surveyor of the District of Columbia in Liber 17 at folio 74; and the portions of the public alley that will revert to Lots 41, 824, 838, 857, 877 and 878, all in Square 454, pursuant to the alley closing approved by the Closing of Public Alleys in Square 454 and Square 455, S.O. 98-194 Act of 1999, effective October 22, 1999 (D.C. Law 13-48; 46 DCR 6768);
A deed to residential real property, without consideration for the transfer, to the trustee of a special needs trust established for the benefit of a trust beneficiary who has a disability, as defined in § 1614(a)(3) of the Social Security Act, approved October 30, 1972 (86 Stat. 1471; 42 U.S.C. § 1382c(a)(3)), or from the trustee of a special needs trust that, by its terms, terminates upon the death of the trust beneficiary with a disability.*For the purposes of subparagraph (A) of this paragraph, a trust is a special needs trust if the trust instrument: States, among its purposes, that the trust assets are not intended to be counted in determining the beneficiary’s eligibility for needs-based governmental benefits; and; Names the beneficiary with a disability as the sole trust beneficiary during his or her lifetime; and; Provides that the beneficiary with a disability shall not serve as trustee;
A security interest instrument securing a credit enhancement, such as a letter of credit, issued by a for-profit business organization, where such credit enhancement is required in connection with affordable housing financing provided by the District of Columbia Housing Finance Agency that is funded in whole or in part through bonds issued pursuant to the U.S. Department of Treasury’s New Issue Bond Program. This paragraph shall apply as of January 1, 2009;
Beginning October 1, 2009, a security interest instrument pertaining to a cooperative housing association;
Beginning October 1, 2009, a deed of economic interest pertaining to a limited-equity cooperative, as defined under § 47-802(11);
A deed to property to which there is a valid certification by the Mayor that both the property and transferee are eligible for exemption from real property taxation pursuant to § 47-1005.02; provided, that, unless waived by regulation, a copy of the certification shall accompany the deed at the time it is submitted for recordation.*For the purposes of this paragraph, the term “deed to property” includes a deed of trust encumbering the property;
A security interest instrument executed by a borrower in connection with a loan under the Industrial Revenue Bond Forward Commitment Program authorized by subchapter II-B of Chapter 3 of Title 47 [§ 47–340.01 et seq.]; provided, that unless waived by regulation, a certification by the Mayor that the security interest instrument is entitled to this exemption accompanies the security interest instrument at the time it is presented for recordation;
Deeds to property transferred to a named beneficiary of a revocable transfer on death deed under subchapter IV of Chapter 6 of Title 19 [§ 19-604.01 et seq.], by reason of the death of the grantor of the revocable transfer on death deed; and
Deeds to property transferred between the electric company and the District pursuant to § 34-1313.11(c).
For a full list of current exemptions, see § 42–1102. Deeds exempt from tax
Have more questions about DC deed taxes? Here’s a handy FAQ from the OTR
OTR Office of Tax and Revenue for the District of Columbia
Information is believed to be accurate, but not guaranteed. Subject to change without notice. Realtors are not CPAs or attorneys and are not permitted to give tax or legal advice or interpretations. Refer to a tax or legal professional for all related matters. Any information provided on this site pertaining to such issues is not intended as tax or legal advice and is provided solely for the purpose of illustration. Resources cited are believed to be reliable but are not guaranteed and are subject to change without notice.