Bulletin Number
VTB 84-10
Tax Type
Recordation Tax
Description
1984 Legislative Changes: Recordation Tax
Topic
Exemptions
Date Issued
06-28-1984
Recordation Tax: 1984 Legislative Changes
The 1984 Session of the General Assembly enacted several laws effective July 1, 1984, affecting recordation taxation. The purpose of this bulletin is to announce those changes.
Exemption for § 368(a)(1)(F) Recordation: § 58-64 was amended to exempt from state and local recordation taxation the recording of any deed conveying real estate to the surviving or new corporation in a reorganization within the meaning of §368(a)(1)(F) of the Internal Revenue Code, i.e., a reorganization which effects a mere change in identity, form or place of incorporation. This amendment will apply to the taxes imposed by §§ 58-54, 58-54.1 and 58-55 of the Code of Virginia. (Chapter 428, House Bill 425).
Additional Grantor's Tax Exemptions: § 58-54.1 (Grantor's Tax) was amended to add the exemptions in paragraphs 6 through 12 of Subsection A of § 58-64 which had previously applied only to §§ 58-54 and 58-55 taxes. The additional grantor's tax exemptions are as follows:
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- "To a corporation upon its organization by persons in control of the corporation in a transaction which qualifies for nonrecognition of gain or Loss pursuant to § 351 of the Internal Revenue Code of 1954, as it exists at the time of the conveyance;
From a corporation to its stockholders upon complete or partial liquidation of the corporation in a transaction which qualifies for income tax treatment pursuant to §§ 331, 332, 333 or 337 of the Internal Revenue Code of 1954, as it exists at the time of liquidation;
To the surviving or new corporation upon merger or consolidation of two or more corporations, or in a reorganization within the meaning of § 368(a)(1)(F) of the Internal Revenue Code of 1954, as amended;
To a subsidiary corporation from its parent corporation, or from a subsidiary corporation to a parent corporation, if the transaction qualifies for nonrecognition of gain or loss under the Internal Revenue Code of 1954, as amended;
- "To a corporation upon its organization by persons in control of the corporation in a transaction which qualifies for nonrecognition of gain or Loss pursuant to § 351 of the Internal Revenue Code of 1954, as it exists at the time of the conveyance;
To a partnership, when the grantors are entitled to receive not less than fifty percent of the profits and surplus of such partnership;
From a partnership, when the grantees are entitled to receive not less than fifty percent of the profits and surplus of such partnership;
To trustees of a trust, when the grantors in the deed and the beneficiaries of the trust are the same persons;
When the grantor is the personal representative of a decedent's estate or trustee under a will or inter vivos trust of which the decedent was the settler, other than a security trust defined in § 55-58.1, and the sole purpose of such transfer is to comply with a devise or bequest in the decedent's will or to transfer title to decedent's spouse or the kindred of decedent or decedent's spouse in accordance with a dispositive provision in the trust instrument." (Chapter 397, House Bill 819).
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