The Pennsylvania Department of Revenue issued Information Notice: Realty Transfer Tax 2014-01 ("Notice") to provide guidance regarding the changes Act 52 of 2013 had on the Commonwealth's realty transfer tax rules for real estate companies and real estate company acquisitions.
The Notice describes, in detail, the clarification of the gross receipts and asset tests, the expanded definition of a "real estate company" and the impact binding commitments and options have on the imposition of the realty transfer tax.
The Notice provides examples of how the structuring of real estate company acquisitions can impact the applicability of the realty transfer tax, as well as how the taxable value is determined in transactions involving real estate companies.
If you have any questions regarding the Notice or its application to any current or future transactions, contact a member of our state and local tax team.
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