REV-1728 - Realty Transfer Tax Declaration of Acquisition

Recording Requirements: A real estate company must
record a Realty Transfer Tax Declaration of Acquisition
within 30 days after becoming an “Acquired Company.”
Real Estate Company - A corporation or association
is a real estate company when it is primarily engaged
in the business of holding, selling or leasing realty
90% or more of the ownership interest in which is held
by 35 or fewer persons and which does one of the fol-
lowing: (1) Derives 60% or more of its annual gross
receipts from the ownership or disposition of realty. (2)
Holds realty, the value which comprises 90% or more
of its entire tangible asset holdings, exclusive of tangi-
ble assets which are freely transferable and actively
traded on an established market.
Acquired Company - A real estate company
becomes an acquired company when 90% or more of
the company’s total ownership interest has been
transferred within a period of three (3) years. A trans-
fer of an ownership interest between members of the
same family is disregarded for purposes of determin-
ing whether an acquisition has occurred.
Family Farm Corporation or Partnership - (applica-
ble only to real estate acquired after February 16,
1986) A family farm corporation, or partnership,
becomes an acquired company when because of vol-
untary or involuntary dissolution, it ceases to be a fam-
ily farm corporation or when, because of issuance or
transfer of stock or because of acquisition, change in
use, or transfer of assets that are devoted to the busi-
ness of agriculture, it fails to meet the minimum
requirements of a family farm corporation.
Members of the Same Family - An individual, such
individual’s brothers and sisters, the brothers and sis-
ters of such individual’s parents and grandparents, the
ancestors and lineal descendents of any of the forego-
ing, a spouse of any of the foregoing, and the estate of
any of the foregoing. Individuals related by the half
blood or by legal adoption must be treated as if they
were related by the whole blood.
General: This declaration must be filed in duplicate with
the recorder(s) of deeds in every county in which the cor-
poration or association owns real estate. Payment of the
State Realty Transfer Tax based on 1% of the amount
reported in block 4. Total Fair Market Value must accom-
pany the Declaration form.
Correspondent: Enter the name, address and telephone
number of party completing this form.
Transfer Data: Complete lines 1 through 5 as indicated.
Property Location: List only those parcels of real estate
located in the county in which this form is being recorded.
Itemize each parcel by school district location. Indicate the
political subdivision in which each parcel is located and the
tax parcel number where applicable.
Property Valuation: Complete for each of the parcels of
real estate itemized in Section C:
1. County Assessed Value -Enter the actual assessed
value of the property as per records of the county
assessment office.
2. Common Level Ratio Factor - Enter the common
level ratio valuation factor applicable for the county in
which this form is being recorded. An explanation of
this factor is provided below.
3. Fair Market Value - Multiply the county assessed
value (Column 1) by the common level ratio factor
(Column 2) and enter the result in Column 3.
Compute the fair market value for each itemized
4. Total Fair Market Value - Add all amounts entered in
Column 3 and enter the total in block 4. This is the
total taxable value upon which state realty transfer
tax is due.
This is a property valuation factor established for each county by the State Tax Equalization Board, as mandated by Act
267-1982. The factors are ratios of assessed values to fair market values as reflected by actual sales of real estate in the
taxing district. This valuation formula has been developed to provide uniformity in the taxing of properties statewide. These
valuation factors are updated each year, and a statewide list can be obtained from the Recorder of Deeds in each county.
When a Declaration of Acquisition is not recorded within 30 days after becoming an acquired company, a penalty in the
amount of 5% of the realty transfer tax due is imposed for each month or fraction thereof in which the tax remains delin-
quent, but not to exceed 50% in the aggregate.
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