HB 449 to apply real estate transfer tax to entity transfers

Legislation to remove exemption from real estate transfer tax for transfers of controlling interest in a pass-through entity that owns real estate

A bill was recently introduced in the Ohio Legislature at the urging of the County Auditors’ Association of Ohio that seeks to have the real estate conveyance fee (transfer tax) to apply to a transfer of more than a 50% interest in a pass-through entity.  The tax would apply to any transaction, or series of transactions, occurring within 12 months of each other, which transfer more than a 50% interest. Within 30 days of such a transfer, a document, not yet created, would have to be filed with the county assessor (auditor). 

Enforcement of the tax is simple for the counties. If not paid by the seller, the “conveyance fee” plus a penalty shall be charged by the county auditor and added to the property tax lien for the property owned by the pass-through entity.

Please feel free to contact us if you have any questions regarding the implications of HB 449.  The full text of the proposed bill can be found here.