To: Realtors AND Loan Officers
From: John M. Brennan, Attorney - President, Brennan Title Company
NEW RULING REGARDING PRINCE GEORGE'S COUNTY'S REQUIREMENT FOR
PROOF OF SALES PRICE
This is the most recent update regarding Prince Georges County recordation and transfer taxes, originally addressed in the January Newsletter sent to you January 15th, 2013. In that Newsletter, we announced a new plan by Prince George's County to charge recordation and transfer taxes based on the full assessed value of a property if the conveyance amount was 50% or less than the assessed value. Immediately after the release of that Newsletter, the county put that ruling "on hold" pending further review.The Treasurer of Prince Georges County, MD has now come out with a revised notice addressing the taxes to be charged in situations where the assessed value is considerably higher than the sales price. That recent notice is included below. Please give us a call if you have any questions or would like to discuss further!
PROOF OF SALES PRICE
(Verification of Consideration Paid or to be Paid on Deed Conveyances)
The Treasury Division of the Prince George's County, MD Office of Finance is tasked with the
duty and responsibility of collecting the requisite County Transfer Tax ("CTT") and State
Recordation Tax ("SRT") on instruments of writing presented to Treasury for review. The "Proof
of Sales Price" requirement in connection with Deed conveyances was initiated by the Treasury
Division to address Deeds presented for review where the purported consideration for the
conveyance is substantially lower than the assessment valuation for the property being
conveyed as determined by the Maryland State Department of Assessment and Taxation
("SDAT"). |
FOR DEED CONVEYANCES where the stated consideration is less than 80% of the Maryland SDAT
assessed value for the property, a copy of the signed Settlement Statement (or HUD-1) is
required. In the absence of the signed Settlement Statement, CTT and SRT tax will be based
upon the current SDAT assessed value.
For Deed conveyances where the stated consideration is less than 50% of the Maryland SDAT
assessed value for the property, the following supporting documentation will be required. In
the absence of this supporting documentation, taxes will be based upon the current SDAT
assessed value. |
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FORECLOSURES:
- Copy of the Report of Sale
- Copy of the Substitute Purchaser's Order (as needed)
SHORT SALES:
- Signed Settlement Statement (or HUD-1)
- Copy of the Letter of Approval from the lender
FOR ALL OTHER TRANSFERS, THE FOLLOWING WILL BE REQUIRED:
- Signed Settlement Statement (or HUD-1)
- Copy of the signed Contract of Sale; and
- Notarized Affidavit(s) from the Grantor(s) and Grantee(s) under the Deed affirming or verifying by way of description and not limitation, the following:
- the actual consideration paid or to be paid in connection with the conveyance.
- that there is no outstanding mortgage or deed of trust on the property, or if there is an outstanding mortgage(s) or deed(s) of trust on the property, a certification of the balance(s) due.
- that there is no prid quo pro (the Grantor is not getting something in addition to the stated consideration under the Deed for conveying the property at substantially less than the property's current assessed value).
- the circumstances for which and the reasons why the property is being
sold for less than the property's current assessed value.
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As noted, the goal is to collect the requisite CTT and SRT due and owing for each
instrument of writing presented for review. Consequently, the Treasury Division reserves the
right to require additional documentation or certification, as needed as the case may be, and
may require additional review time and assistance from the County's legal counsel. |
