[WSBARP] Excise Tax on QCD

[nestor at pplsweb.com]

They haven't told me of purpose, who is making the payments or if client
will be a "co-borrower" on the loan other than joinder to encumber the
property, so I am still not clear.

Once I have all the facts I will call DOR to be safe.

 

Nestor 

 

 

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com>
On Behalf Of Eric Nelsen
Sent: Wednesday, May 9, 2018 12:20 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Excise Tax on QCD

 

But what is the money going to be used for? Any of it going to the client? I
think that would be consideration: client "gives" brother an interest in the
property, and brother takes out a loan on the property and gives money to
client.

 

If you use -215, then brother would be effectively receiving only a nominal
interest in the property for security purposes only.

 

I think I'm still not clear on the purpose of the transaction--why brother
is getting a loan, what the arrangement between client and brother is. I
think any scenario where brother gets a property interest and then client
receives anything of value (proceeds from the loan or whatever), it could
trigger REET.

 

Sincerely,

 

Eric

 

Eric C. Nelsen

SAYRE LAW OFFICES, PLLC

1417 31st Ave South

Seattle WA  98144-3909

phone 206-625-0092

fax 206-625-9040

 

From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
[mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of nestor at pplsweb.com
<mailto:nestor at pplsweb.com> 
Sent: Wednesday, May 09, 2018 12:03 PM
To: 'WSBA Real Property Listserv'
Subject: Re: [WSBARP] Excise Tax on QCD

 

Thank you for the response. I reviewed the statute, which of course prompted
me to dig in further. In my case, the property is unencumbered and they are
not refinancing existing debt. Brother is being added because he has good
credit and will be the principal borrower.

 

I found WAC 458-61A-215. Looks like it is exempt as long as client makes all
the payments. However, if client is not a "borrower" I am not sure how that
will be affected.

 

Nestor

 

Nestor Gorfinkel, Attorney at Law

Licensed in Washington & Florida

Florida Civil-Law (International) Notary

P Please consider the environment before printing this e-mail.

 

 

From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
<wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com> > On Behalf Of John McCrady
Sent: Wednesday, May 9, 2018 11:27 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com
<mailto:wsbarp at lists.wsbarppt.com> >
Subject: Re: [WSBARP] Excise Tax on QCD

 

See WAC 458-61A 201(4) (a) 

There is a rebuttable presumption that the transfer is a sale and not a gift
if the grantee is involved in a refinance of debt on the property within six
months of the time of the transfer.

 

I don't know whether there has been an decision construing "refinance".

 

John McCrady

Counsel

Puget Sound Title Company

5350 Orchard Street West

University Place WA 98467

253-476-5721

j.mccrady at pstitle.com <mailto:j.mccrady at pstitle.com> 

 

From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
[mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of nestor at pplsweb.com
<mailto:nestor at pplsweb.com> 
Sent: Wednesday, May 09, 2018 10:33 AM
To: 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com
<mailto:wsbarp at lists.wsbarppt.com> >
Subject: [WSBARP] Excise Tax on QCD

 

Client has unencumbered property and wants to add brother as a gift and then
and then refinance with brother as the main borrower.  The way I see it
Excise Tax not due on the transfer. Let me know if I am wrong. 

  

I would of course have the transfer done in advance of the refinance. 

  

  

Nestor Gorfinkel, Attorney at Law 

Licensed in Washington & Florida 

Florida Civil-Law (International) Notary 

  

P Please consider the environment before printing this e-mail. 

  

  

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