| 1 | A bill to be entitled |
| 2 | An act relating to the excise tax on documents; amending |
| 3 | s. 201.02, F.S.; imposing the tax on the consideration for |
| 4 | short sale transfers of real property; excluding certain |
| 5 | unpaid indebtedness from such consideration; defining the |
| 6 | term "short sale"; authorizing the Department of Revenue |
| 7 | to adopt rules establishing arm's length criteria for |
| 8 | short sale purposes; providing an effective date. |
| 9 |
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| 10 | Be It Enacted by the Legislature of the State of Florida: |
| 11 |
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| 12 | Section 1. Subsection (11) is added to section 201.02, |
| 13 | Florida Statutes, to read: |
| 14 | 201.02 Tax on deeds and other instruments relating to real |
| 15 | property or interests in real property.-- |
| 16 | (11) The tax imposed by this section applies to any deed, |
| 17 | instrument, or writing that transfers any interest in real |
| 18 | property pursuant to a short sale. The taxable consideration for |
| 19 | a short sale transfer does not include unpaid indebtedness that |
| 20 | is forgiven or released by a mortgagee holding a mortgage on the |
| 21 | grantor's interest in the property. For purposes of this |
| 22 | subsection, the term "short sale" means a purchase and sale of |
| 23 | real property in which all of the following apply: |
| 24 | (a) The grantor's interest is encumbered by a mortgage or |
| 25 | mortgages securing indebtedness in an aggregate amount greater |
| 26 | than the purchase price paid by the grantee. |
| 27 | (b) A mortgagee releases the real property from its |
| 28 | mortgage in exchange for a partial payment of less than the |
| 29 | total of the outstanding mortgage indebtedness owed to the |
| 30 | releasing mortgagee. |
| 31 | (c) The releasing mortgagee does not receive, directly or |
| 32 | indirectly, any interest in the property transferred. |
| 33 | (d) The releasing mortgagee, grantor, and grantee are |
| 34 | dealing with each other at arm's length. For purposes of this |
| 35 | subsection, the fact that the parties are related or controlled |
| 36 | by one another is not, alone, sufficient evidence that the |
| 37 | parties are not dealing with each other at arm's length. |
| 38 | Section 2. The Department of Revenue may adopt rules |
| 39 | establishing criteria that indicate when the parties to a short |
| 40 | sale are not dealing with each other at arm's length. |
| 41 | Section 3. This act shall take effect July 1, 2010. |