[WSBAPT] community property agreements

Ryan P. Coon cole-gilday at stanwoodlaw.net
Mon Jul 19 09:44:18 PDT 2021 

This is pretty much how we have been handling CPA's, in the two steps 
that you outline. The counties are generally fine with us on the first 
step where we're just recording the CPA with an attached death 
certificate. Where the counties (Island, Snohomish, and King) dig their 
heels in is when we subsequently attempt to record the CPA Affidavit 
(with death certificate and REETA).

Island County Treasurers office just sent back our CPA Affidavit stating 
that "Per the Department of Revenue Real Estate Excise Tax (DORREET) 
division a Community Property Agreement (CPA) cannot by used to transfer 
ownership of property in Washington State. A separate deed for 
conveyance of title is required."

When we talk to the title companies they are also dumbfounded as to why 
these are getting rejected. It sounds like we may need to get the DOR 
involved and see if they can offer some direction to the Counties.

Very Truly Yours,

Ryan P. Coon

Law Office of Cole & Gilday, P.C.

//

10101 - 270th St. NW

Stanwood, WA 98292

(360) 629-2900 (Telephone)

(360) 629-0220 (Fax)

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On 7/16/2021 6:17 PM, Joshua McKarcher wrote:
>
> One important distinction here between recording a CP agreement to 
> memorialize it vs. recording documents to FULFILL it (and change title):
>
> Recording a CP agreement _before_ its fulfillment requires no REETA 
> because no title transfers (e.g., if you record it after signing, even 
> though recordation is not required (contra Idaho, where it must be 
> recorded in each county where real property is located _before_ either 
> spouse dies)). See WAC 458-61A-303(3)(g).
>
> But, look above (3)(g) at sub (2)(a): Recording a death certificate 
> and affidavit to confirm the death of a spouse who was party to a CP 
> agreement and to effectuate transfer of title – i.e., to fulfill the 
> agreement – does require a REETA (which itself should have attached a 
> copy of the recorded CP agreement and a _certified copy_ of the death 
> certificate), because title is transferring and that transfer is 
> exempt from tax. See WAC 458-61A-202(6)(a) 
> (https://app.leg.wa.gov/wac/default.aspx?cite=458-61A-202 
> <https://app.leg.wa.gov/wac/default.aspx?cite=458-61A-202>).
>
> In sum, WAC 458-61A-303(2)(a) relates to fulfillment of the CP 
> agreement after one spouse dies (title transfers = REETA required), 
> and (3)(g) relates to the simple recordation of the document without 
> transfer of title (no affect on title = no REETA required).
>
> Same concept as with Transfer on Death Deeds: no REETA when merely 
> _memorialized_, but REETA when _fulfilled_/_effectuated_.
>
> Practice Tip: if wanting to change title after Spouse 1’s death with a 
> previously _un_recorded CP agreement, do not do it all in one step. 
> You’re mixing WACs and staff could be confused easily.
>
> Instead, first, record the CP agreement by itself. Done. No REETA. 
> (Use Simplifile – you’ll never regret paying for it!) Nobody knows to 
> reject anything because you’re not announcing anyone’s death or 
> changing title.
>
> Now you have the document that you must attach to the REETA to change 
> title in step two. So, second, submit the REETA for approval to 
> Treasurer with proposed affidavit supporting CP agreement and related 
> REETA (with attached copy of recorded CP agreement and certified DC) 
> and $10 check. Treasurer signs off on REETA, you record with Auditor 
> the affidavit in support of CP agreement with DC as exhibit. Voila! If 
> anyone argues, you have extremely clear path – for each separate 
> transaction – in the above WACs.
>
> (This is all so absurdly complex that I answer these emails now and 
> then just to provide myself a chance to CONFIRM the law is the same as 
> the last time I looked! Ha!)
>
> Happy weekend, fearless estate planners! Best, Josh
>
> Joshua D. McKarcher
>
> McKarcher Law PLLC
>
> 537 6th Street
>
> Clarkston, WA 99403
>
> (509) 758-3345
>
> (509) 758-3314 (fax)
>
> josh at mckarcherlaw.com <mailto:josh at mckarcherlaw.com>
>
> www.mckarcherlaw.com <http://www.mckarcherlaw.com>
>
> *From:*wsbapt-bounces at lists.wsbarppt.com 
> <wsbapt-bounces at lists.wsbarppt.com> *On Behalf Of *Nicholas Pleasants
> *Sent:* Friday, July 16, 2021 5:05 PM
> *To:* WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
> *Subject:* Re: [WSBAPT] community property agreements
>
> Never had a problem recording CPA’s in King County, no REETA required. 
> And I don’t think it should matter what county you record it in, as 
> long as it becomes a public record. And King County is on Simplifile. 
> So perhaps a practical solution is to record all CPA’s in King County :)
>
> Have a nice weekend all!
>
> Best,
>
> Nick
>
> *From: *<wsbapt-bounces at lists.wsbarppt.com 
> <mailto:wsbapt-bounces at lists.wsbarppt.com>> on behalf of Joshua 
> McKarcher <josh at mckarcherlaw.com <mailto:josh at mckarcherlaw.com>>
> *Reply-To: *WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com 
> <mailto:wsbapt at lists.wsbarppt.com>>
> *Date: *Friday, July 16, 2021 at 4:11 PM
> *To: *WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com 
> <mailto:wsbapt at lists.wsbarppt.com>>
> *Subject: *Re: [WSBAPT] community property agreements
>
> Yikes! No problems I’m aware of in the southeast corner of the State 
> here.
>
> Unless the law changed, it sounds like you have some educating to do. 
> Or, if that falls flat, I’d next be inclined to let the county 
> prosecutor’s office know (gently, at first) that its clients (assessor 
> and auditor, I presume) are making up rules and disregarding law that 
> could have material impact on county citizens and expose the county to 
> legal liability. Perhaps an “opinion” from their prosecutor’s office 
> confirming that state of the relevant laws would help?
>
> Or maybe I’m naïve and you’ll have more of a battle on your hands.
>
> Another approach is to get your friends at the local title company on 
> board. If they confirm that title insurers are not suddenly requesting 
> deeds like you describe, maybe their friends in the assessor’s and 
> auditor’s offices will find their way to play ball.
>
> Good luck!
>
> Joshua D. McKarcher
>
> McKarcher Law PLLC
>
> 537 6th Street
>
> Clarkston, WA 99403
>
> (509) 758-3345
>
> (509) 758-3314 (fax)
>
> josh at mckarcherlaw.com <mailto:josh at mckarcherlaw.com>
>
> www.mckarcherlaw.com <http://www.mckarcherlaw.com>
>
> *From:*wsbapt-bounces at lists.wsbarppt.com 
> <mailto:wsbapt-bounces at lists.wsbarppt.com> 
> <wsbapt-bounces at lists.wsbarppt.com 
> <mailto:wsbapt-bounces at lists.wsbarppt.com>> *On Behalf Of *Robert R. Cole
> *Sent:* Friday, July 16, 2021 2:53 PM
> *To:* WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com 
> <mailto:wsbapt at lists.wsbarppt.com>>
> *Subject:* [WSBAPT] community property agreements
>
> We are having frustrating problems in the recording of Community 
> Property Agreements (along with the death certificate and an 
> Affidavit) to transfer property to the surviving spouse.  Counties are 
> refusing to record them, saying that they need a deed from the 
> surviving spouse to the surviving spouse.  Even including a REETA 
> doesn't work.   And Island County Treasurer is now saying that the 
> CPA  doesn't pass title, and they won't record a deed from the (now 
> deceased) surviving spouse's estate because the property is still 
> titled in the deceased spouse's name, even tho the CPA etc was 
> recorded over a decade ago.  Are CPAs now basically worthless?
>
> -- 
>
> Very Truly Yours,
>
> Robert R. Cole
>
> Law Office of Cole & Gilday, P.C.
>
> 10101 - 270th St. NW
>
> Stanwood, WA 98292
>
> (360) 629-2900 (Telephone)
>
> (360) 629-0220 (Fax)
>
> This message contains confidential and privileged information that is 
> intended only for the named recipient(s).  Unless you are the named 
> recipient or authorized agent thereof, you are prohibited from 
> reading, copying, distributing or otherwise disseminating such 
> information.  If you receive this communication in error, please 
> notify the sender immediately.
>
>
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