Amended
IN
Assembly
January 06, 2014 |
Amended
IN
Assembly
May 09, 2013 |
Amended
IN
Assembly
April 30, 2013 |
Introduced by Assembly Member Ting |
February 20, 2013 |
Existing law prohibits the imposition of the documentary transfer tax, in the case of any realty held by a partnership, upon any transfer of an interest in a partnership under specified conditions. Existing law also prohibits more than one documentary tax from being imposed by reason of a specified termination of any partnership or other entity treated as a partnership, and any transfer pursuant to that termination with respect to the realty held by the partnership or other entity.
This bill would
eliminate those prohibitions.
(a)No levy shall be imposed pursuant to this part by reason of any transfer between an individual or individuals and a legal entity or between legal entities that results solely in a change in the method of holding title to the realty and in which proportional ownership interests in the realty, whether represented by stock, membership interest, partnership interest, cotenancy interest, or otherwise, directly or indirectly, remain the same immediately after the transfer.
(b)Notwithstanding subdivision (a), if there is a termination of a partnership or other entity treated as a partnership for federal income tax purposes, within the meaning of
Section 708 of the Internal Revenue Code of 1986, for purposes of this part the partnership or other entity shall be treated as having executed an instrument whereby there was conveyed, for fair market value, exclusive of the value of any lien or encumbrance remaining thereon, all realty held by the partnership or other entity at the time of the termination.
(c)No more than one tax shall be imposed pursuant to this part by a county, city, or city and county by reason of a termination described in subdivision (b), or any transfer pursuant thereto, with respect to the realty held by a partnership or other entity treated as a partnership at the time of termination.