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The governor has signed into HB 761 into Act 85 and transfers of family farms for corporate liability reasons are now exempted from the realty transfer tax reports State Rep. Jim Cox (R-129) Excluded from the tax is the “transmission of real estate devoted to agriculture if the transfer is to a family farm, general, limited or limited-liability partnership by a member of the same family and the family directly owns at least 75 percent of the interests in the partnership,” says Cox. It would also exempt a transfer between members of the same family of an ownership interest in a real estate company, family farm corporation, general, limited or limited-liability partnership which owns real estate. It further exempts the transfer of certain agricultural real estate and property to a surviving child or sibling from the state’s inheritance tax by exempting from the realty transfer tax a transfer of real estate used for agriculture by a family member to family farm business controlled by the same members of the same family. In other cases, the realty transfer tax is imposed at 2 percent of the value of the property being transferred. The law reverses a policy change enacted during the Rendell administration which allows the state to collect taxes from a farm owner who reorganizes his or her agricultural business for corporate liability reasons. A 2000 court decision established the principle that a conveyance of realty owned by a general partnership to a “succeeding” limited partnership would not be considered a “transfer of realty” if the partners and proportionate share of ownership interests among the partners remains the same. |
Good job Guv!