[WSBARP] REET and TEDRA Agreement Question

[Gabriel Dietz]

Thank you, Bryce and David for your fast responses. That answers my
question, and I appreciate David's additional insight into the TEDRA
agreement provisions.

Gabriel A. Dietz

Partner

Hoerschelmann Dietz PLLC
p: (206) 451-3859

f: (206) 337-4506

*gabe at hdpnw.com <gabe at hdpnw.com>*

*www.hdpnw.com <http://www.hdpnw.com/>*

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On Fri, May 5, 2023 at 11:56 AM David Moe <davidmoe at maplevalleylaw.com>
wrote:

> I agree with Bryce.  Also, under WAC 458-61A-202, see Subparagraph (5)(c)
> Example 4, under “Subsequent transfers,” where ‘Sheri’ wants sole ownership
> and her two sisters want cash in lieu of their respective 1/3 shares—but
> there are no (or in Gabriel’s case) insufficient other distributable estate
> assets to qualify as acquired in a (fully) nonpro rata distribution.
> There,  all the real estate excise tax is reported and paid under a
> “prior” separate deed from Sheri’s sisters to the estate PR as grantee;
> then, to complete the distribution, the estate PR can then make a separate
> deed from the estate to Sheri whereby she acquires sole ownership and by
> the REETA can simply claim “inheritance or devise.”  No valuable
> consideration will have passed from the grantee to the grantor.
>
>
>
> I have prepared a TEDRA, to be available as “additional documentation”
> should such be requested by the recording officer or DOR,  or the mortgage
> lender.  As part of the TEDRA recitals, the dollar values of the “inherited
> share portion” and the “purchase money” portions can be documented, and the
> parties can allocate the responsibility for real estate excise tax and
> other closing costs.  If institutional financing will be involved, the
> TEDRA might complement or substitute for a purchase and sale agreement, and
> might help the “borrower” qualify for more favorable “refinance” loan
> terms, based on the inherited portion.
>
>
>
>
>
> Sent from Mail <https://go.microsoft.com/fwlink/?LinkId=550986> for
> Windows
>
>
>
> *From: *Bryce Dille <Bryce at dillelaw.com>
> *Sent: *Friday, May 5, 2023 9:16 AM
> *To: *WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
> *Subject: *Re: [WSBARP] REET and TEDRA Agreement Question
>
>
>
> The would be excise tax due see pararaph (3) subsequent transfer under
> WAC458-61A-202
>
>
>
> Bryce H. Dille
>
> Dille Law, PLLC
>
> 2010 Caton Way SW Ste. 101
>
> Olympia, WA 98502
>
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>
> Cell: 253-579-5561
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> Business Entity Creation and Management, Business, Government and Tax Law,
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> *From:* wsbarp-bounces at lists.wsbarppt.com <
> wsbarp-bounces at lists.wsbarppt.com> *On Behalf Of *Gabriel Dietz
> *Sent:* Thursday, May 4, 2023 4:42 PM
> *To:* WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
> *Subject:* [WSBARP] REET and TEDRA Agreement Question
>
>
>
> Good Afternoon Listmates,
>
>
>
> Mom passed away in 2014. Dad passed away in 2022. Daughters A, B, and C
> are the surviving relatives and beneficiaries under Mom's credit trust. Dad
> was the trustee until he died. Daughter A is now the trustee. The house is
> valued at $2.7M in the trust. There is also $800,000 in other assets in the
> trust. A, B, and C want to distribute the other assets evenly to A and B
> and distribute the house to C. C would owe A and B $1,533,333.33, or
> $766,666.67 each as a result from an accounting perspective to
> make distributions valued the same. Under WAC 458-61A-202 is excise tax due
> on $1,533,333.33 as payment from C to A and B, for C to take sole title? I
> thought I would check with those more experienced since I haven't done this
> exact scenario before.
>
>
>
> Thank you,
>
>
> Gabriel A. Dietz
>
> Partner
>
> Hoerschelmann Dietz PLLC
> p: (206) 451-3859
>
> f: (206) 337-4506
>
> gabe at hdpnw.com
>
> www.hdpnw.com
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