[WSBARP] Short Platt devloper and excited buyer

[Mark Higgins]

On the sale back for $1​:  I believe the excise tax is based on the value
of the property if the sales price is not at that value.

On Tue, Jun 23, 2015 at 2:20 PM, Josh Grant <jgrant at accima.com> wrote:

>   Developer is developing a 40 acre piece.  He will be short platting it
> into 5 acre pieces.  Surveyor is telling him this should be no problem in
> getting this approved.
>
> My client is a prospective buyer.  They have a legal description for his
> five acres from the surveyor.  He wants to get going with a new house.  I
> told him, “no, you have to wait til the short plat is approved, for a bunch
> of legal reasons, but in addition the bank won’t lend you the $250,000 for
> the new house til you are a fee owner”.
>
> So now the two of them have agreed as follows:
>
> Developer will sell the 40 acres to the client for the agreed upon
> purchase price of the five acre ($35,000). Developer will continue to pay
> all costs to get the short plat approved (about a year from now).
> Developer will be obligated to pay all costs even though client will be
> signing the applications etc.  Developer will be granted an option to
> purchase the 35 acres back when the short plat is finally approved for
> $1.00.
>
> Would the 1% excise tax be based on the $35,000 first sale?  Probably.
> The transfer back of the 35 acres for $1.00 plus all the development
> costs... what would the excise tax be based on?
> I see lots of problems from the developer’s side, but what else would the
> buyer be exposed to if this never gets approved?
>
> and if this is a doable thing, anyone have forms for the option to
> purchase ?  (yeah right).
>
> Thanks
>
> Josh
>
> Joshua F. Grant, PS
> Attorney at Law
> P. O. Box 619
> Wilbur, WA 99185
> tel 509 647 5578
> fax 509 647 2734
>
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-- 
Mark T. Higgins
Mark T. Higgins, P.C.
P.O. Box 57
Darrington, WA 98241
206-491-2420
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