Spring 2011Issue 11
Prestige Title Agency, Inc.

Prestige Title eNews

Spring 2011
Greetings! 
Welcome to our Spring Newsletter. In this issue, we discuss transfer tax issues related to conveyances pursuant to divorce or separation aggreement.
  
In addition, some important service changes to the New York City Register's Office.
  
Have a wonderful Spring!

Regards,

 

- Anthony Chiellino, President 

RCandRPTransfer Tax on Conveyances Pursuant to Divorce Decree or Separation Agreement

 

Conveyances for no consideration made between spouses are a common occurrence. Such conveyances may be made for a host of purposes, such as the making of a gift, estate planning, and loan eligibility.

 

In all of these instances, no money is being exchanged. The transfer is without consideration and is not in connection with a sale. As a consequence, gift transfers or transfers made without consideration are not subject to transfer tax. Both the NYS real estate transfer tax return (TP-584) and the NYC RPT real property tax return (NYC-RPT) list no consideration transfers among the types of conveyances that are exempt from transfer tax.

 

But what of conveyances made pursuant to divorce decree or separation agreement? In such instances, no money is being exchanged. Is the transfer without consideration and not in connection with a sale?

 

At first glance, one might assume that because no money is actually being paid, the conveyance is without consideration and not in connection with a sale. Schedule I of the NYC-RPT addresses this issue. It asks for four pieces of information: the fair market value, the existence of any unpaid mortgages, the percentage of ownership interest being transferred to the other spouse, and any alternate value assigned to the transferred interest that is recited in the settlement agreement, separation agreement or divorce decree. The basis for taxation is found in Section 23-03(d)(3) of Title 19 of the Rules of the City of New York ("RCNY"). This section states that "a conveyance of realty from one spouse to the other pursuant to the terms of a separation agreement" is subject to tax. 

 

 

If you have any questions or would like further information regarding any of the articles in this newsletter, please contact Keith Eng, Esq. at (212) 651-1200 or keng@prestitle.com.  
 
Also, if there are any topics that you would like us to include in future newsletters, please feel free to e-mail us with suggestions at info@prestitle.com  
In This Issue
Announcements
Did you know that Prestige Title handles Commercial transactions nationwide?
 
Please contact Anthony Chiellino for further details at (212) 651-1200 or achiellino@prestitle.com.

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Service Changes at the City Register  -  Click Here

 

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Prestige Title Agency, Inc. provides Commercial and Residential Title Services Nationwide. For more information, please contact Anthony Chiellino at (212) 651-1200 or achiellino@prestitle.com

15 W. 39th St. 10th Fl. New York, NY 10018 Tel (212) 651-1200 Fax (212) 651-1201
Member of New York State Land Title Association Member of American Land Title Association