Assessor-Recorder Carmen Chu Strengthens Transfer Tax Code Through Certification Of Prop W
ASSESSOR-RECORDER CARMEN CHU STRENGTHENS TRANSFER TAX CODE THROUGH CERTIFICATION OF PROP W
62% of voters supported Prop W to amend tax rate and clarify transfer tax code
SAN FRANCISCO – On Tuesday, December 13th, the San Francisco Board of Supervisors certified the 2016 November General Election results, confirming approval of Proposition W – Real Estate Transfer Tax on Properties Over $5 million. Apart from changing the calculation for transfer taxes, the ballot measure further clarifies the application of transfer tax for legal entities, a component championed by Assessor-Recorder Carmen Chu.
Assessor-Recorder Chu expressed, “As a fiscal steward for this City, it is my responsibility to ensure the fair application of our tax laws.” Chu continued, “I appreciate the opportunity to partner with Supervisor Kim and our legislative representatives on incorporating our amendment. The amendment means taxpayers have a clearer picture of when transfer tax applies for legal entities.”
During the legislative process earlier in the year, Assessor-Recorder Carmen Chu collaborated with Supervisor Jane Kim, the main author of Prop W, to amend the measure. The language of the amendment clarifies that legal entities transferring real estate interests are subject to transfer tax consistent with the State’s definition of changes that trigger a reassessment regardless of the manner in which entities are organized under federal tax law. In general, ownership changes in real property trigger the collection of transfer tax. For legal entities that may only partially transfer real property interests, the State defines the threshold for change in ownership for reassessment purposes.
Last year alone, the Office of the Assessor-Recorder collected $274 million in transfer tax revenue, all of which was directed to the City’s General Fund to pay for essential services like health and public safety, family and recreation services.
Passed by the Board of Supervisors unanimously, the measure was submitted to voters on the November 2016 ballot. The local measure needed a simple majority vote to pass and received 62% of the vote. In San Francisco, transfer tax rates are set locally through voter approval. The Office of the Assessor-Recorder will implement the new law as directed by voters beginning December 27, 2016. For an updated Transfer Tax Affidavit and additional information please visit www.sfassessor.org.