Florida Senate - 2010                              CS for SB 234
       By the Committee on Judiciary; and Senator Ring
       590-01394-10                                           2010234c1
    1                        A bill to be entitled                      
    2         An act relating to the excise tax on documents;
    3         amending s. 201.02, F.S.; imposing the tax on the
    4         consideration for short sale transfers of real
    5         property; excluding certain unpaid indebtedness from
    6         such consideration; defining the term “short sale”;
    7         authorizing the Department of Revenue to adopt rules
    8         establishing arm’s length criteria for short sale
    9         purposes; providing an effective date.
   11  Be It Enacted by the Legislature of the State of Florida:
   13         Section 1. Subsection (11) is added to section 201.02,
   14  Florida Statutes, to read:
   15         201.02 Tax on deeds and other instruments relating to real
   16  property or interests in real property.—
   17         (11) The tax imposed by this section applies to any deed,
   18  instrument, or writing that transfers any interest in real
   19  property pursuant to a short sale. The taxable consideration for
   20  a short sale transfer does not include unpaid indebtedness that
   21  is forgiven or released by a mortgagee holding a mortgage on the
   22  grantor’s interest in the property. For purposes of this
   23  subsection, the term “short sale” means a purchase and sale of
   24  real property in which all of the following apply:
   25         (a) The grantor’s interest is encumbered by a mortgage or
   26  mortgages securing indebtedness in an aggregate amount greater
   27  than the purchase price paid by the grantee.
   28         (b) A mortgagee releases the real property from its
   29  mortgage in exchange for a partial payment of less than the
   30  total of the outstanding mortgage indebtedness owed to the
   31  releasing mortgagee.
   32         (c) The releasing mortgagee does not receive, directly or
   33  indirectly, any interest in the property transferred.
   34         (d) The releasing mortgagee, grantor, and grantee are
   35  dealing with each other at arm’s length. For purposes of this
   36  subsection, the fact that the parties are related or controlled
   37  by one another is not, alone, sufficient evidence that the
   38  parties are not dealing with each other at arm’s length. The
   39  department may adopt rules pursuant to ss. 120.536 and 120.54
   40  establishing criteria that indicate when the parties to a short
   41  sale are not dealing with each other at arm’s length.
   42         Section 2. This act shall take effect July 1, 2010.