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<DIV style="FONT-SIZE: 14pt; FONT-FAMILY: 'Calibri'; COLOR: #000000">
<DIV><FONT size=4>Thanks Eric</FONT></DIV>
<DIV> </DIV>
<DIV style="FONT-SIZE: 14pt; FONT-FAMILY: 'Calibri'; COLOR: #000000">
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<DIV style="FONT-SIZE: 14pt; FONT-FAMILY: 'Calibri'; COLOR: #000000">
<DIV><STRONG><SPAN style="FONT-SIZE: 18pt; COLOR: #004080">Joshua F.
Grant</SPAN></STRONG><SPAN style="COLOR: #004080"><BR></SPAN><SPAN
style="COLOR: black"><IMG title=advocates
style="BORDER-TOP: 0px; BORDER-RIGHT: 0px; BACKGROUND-IMAGE: none; BORDER-BOTTOM: 0px; PADDING-TOP: 0px; PADDING-LEFT: 0px; BORDER-LEFT: 0px; DISPLAY: inline; PADDING-RIGHT: 0px"
border=0 alt=advocates src="cid:41CACEFA03524B0FB1230CDF2AD6BFAC@JoshPC"
width=207 height=43><BR></SPAN><SPAN style="FONT-SIZE: 11pt; COLOR: #004080">P.
O. Box 619<BR>Wilbur, WA 99185<BR>509 647 5578</SPAN><SPAN
style="COLOR: black"><o:p></o:p></SPAN></DIV></DIV></DIV></DIV>
<DIV
style='FONT-SIZE: small; TEXT-DECORATION: none; FONT-FAMILY: "Calibri"; FONT-WEIGHT: normal; COLOR: #000000; FONT-STYLE: normal; DISPLAY: inline'>
<DIV style="FONT: 10pt tahoma">
<DIV> </DIV>
<DIV style="BACKGROUND: #f5f5f5">
<DIV style="font-color: black"><B>From:</B> <A
title=eric@sayrelawoffices.com>Eric Nelsen</A> </DIV>
<DIV><B>Sent:</B> Thursday, June 02, 2022 11:41 AM</DIV>
<DIV><B>To:</B> <A title=wsbarp@lists.wsbarppt.com>WSBA Real Property
Listserv</A> </DIV>
<DIV><B>Subject:</B> Re: [WSBARP] REET tax and change of cotnrolling
interest</DIV></DIV></DIV>
<DIV> </DIV></DIV>
<DIV
style='FONT-SIZE: small; TEXT-DECORATION: none; FONT-FAMILY: "Calibri"; FONT-WEIGHT: normal; COLOR: #000000; FONT-STYLE: normal; DISPLAY: inline'>
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<P class=MsoNormal>I read <A
href="https://app.leg.wa.gov/WAC/default.aspx?cite=458-61A-101">WAC
458-61A-101</A> to mean that the focus of the tax is on what total percentage is
transferred from the grantor, and it doesn’t matter what the resulting grantee
interests are. If the grantor transfers less than 50%, then there is no transfer
of a controlling interest and there is no tax. If the grantor transfers a total
of 50% or more, then the tax is triggered, even if the grantor transfers that
50% in small amounts to a dozen different grantees such that no grantee gains a
controlling interest.<o:p></o:p></P>
<P class=MsoNormal><o:p></o:p> </P>
<P class=MsoNormal>Note also that the tax is determined based on a total of all
transfers from a particular grantor that occur within a 36-month period. Also
consider the effect of the “acting in concert” rules under WAC 458-61A-101(2)(e)
for when multiple grantors would be considered in the aggregate for purposes of
analyzing whether 50% has been transferred.<o:p></o:p></P>
<P class=MsoNormal><o:p></o:p> </P>
<P class=MsoNormal>In your example, if parents hold 48%, and transfer away all
48% to the kids in equal shares, I think no tax is triggered because the total
interest transferred is less than 50% (even if mom and dad are “acting in
concert”).<o:p></o:p></P>
<P class=MsoNormal><o:p></o:p> </P>
<DIV>
<P class=MsoNormal>Sincerely,<o:p></o:p></P>
<P class=MsoNormal><o:p></o:p> </P>
<P class=MsoNormal>Eric<o:p></o:p></P>
<P class=MsoNormal><o:p></o:p> </P>
<P class=MsoNormal>Eric C. Nelsen<o:p></o:p></P>
<P class=MsoNormal>Sayre Law Offices, PLLC<o:p></o:p></P>
<P class=MsoNormal>1417 31st Ave South<o:p></o:p></P>
<P class=MsoNormal>Seattle WA 98144-3909<o:p></o:p></P>
<P class=MsoNormal>206-625-0092<o:p></o:p></P>
<P class=MsoNormal><A><SPAN
style="COLOR: #0563c1">eric@sayrelawoffices.com</SPAN></A><o:p></o:p></P>
<P class=MsoNormal><o:p></o:p> </P>
<P class=MsoNormal><B><SPAN
style="BACKGROUND: aqua; mso-highlight: aqua">Covid-19 Update - </SPAN></B>All
attorneys are working remotely during regular business hours and are available
via email and by phone. Videoconferencing also is available. Signing of estate
planning documents can be completed and will be handled on a case-by-case basis.
Please direct mail and deliveries to the Seattle office.<o:p></o:p></P></DIV>
<P class=MsoNormal><o:p></o:p> </P>
<DIV>
<DIV
style="BORDER-TOP: #e1e1e1 1pt solid; BORDER-RIGHT: medium none; BORDER-BOTTOM: medium none; PADDING-BOTTOM: 0in; PADDING-TOP: 3pt; PADDING-LEFT: 0in; BORDER-LEFT: medium none; PADDING-RIGHT: 0in">
<P class=MsoNormal><B>From:</B> wsbarp-bounces@lists.wsbarppt.com
<wsbarp-bounces@lists.wsbarppt.com> <B>On Behalf Of </B>Josh
Grant<BR><B>Sent:</B> Thursday, June 2, 2022 11:09 AM<BR><B>To:</B> WSBA Real
Property Listserv <wsbarp@lists.wsbarppt.com><BR><B>Subject:</B> Re:
[WSBARP] REET tax and change of cotnrolling interest<o:p></o:p></P></DIV></DIV>
<P class=MsoNormal><o:p></o:p> </P>
<DIV>
<DIV>
<DIV>
<P class=MsoNormal><SPAN
style="FONT-SIZE: 14pt; COLOR: black"> <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">Happy to
Rod...</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">More
simply, When less than 50% minority members assign their membership
interest to kids (who are also minority members); and after assignment kids are
still all minority members, and it is a gift... not a sale... I assume
there is no requirement to file a controlling interest REET affid. and/or pay
REET taxes?</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style="FONT-SIZE: 13.5pt; COLOR: black">thanks</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style="FONT-SIZE: 13.5pt; COLOR: black">Josh</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<DIV>
<DIV>
<DIV>
<P class=MsoNormal><STRONG><SPAN
style='FONT-SIZE: 18pt; FONT-FAMILY: "Calibri",sans-serif; COLOR: #004080'>Joshua
F. Grant</SPAN></STRONG><SPAN
style="FONT-SIZE: 14pt; COLOR: #004080"><BR></SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><IMG id=_x0000_i1029
style="HEIGHT: 0.447in; WIDTH: 2.156in" border=0 alt=advocates
src="cid:77B3C0A36AA54345861180D727FFB0E3@JoshPC" width=207
height=43></SPAN><SPAN style="FONT-SIZE: 14pt; COLOR: black"><BR></SPAN><SPAN
style="COLOR: #004080">P. O. Box 619<BR>Wilbur, WA 99185<BR>509 647
5578</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV></DIV></DIV></DIV>
<DIV>
<DIV>
<DIV>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'> <o:p></o:p></SPAN></P></DIV>
<DIV>
<DIV>
<P class=MsoNormal style="BACKGROUND: whitesmoke"><B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'>From:</SPAN></B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'> Rod
Harmon <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal style="BACKGROUND: whitesmoke"><B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'>Sent:</SPAN></B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'>
Thursday, June 02, 2022 9:14 AM<o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal style="BACKGROUND: whitesmoke"><B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'>To:</SPAN></B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'> WSBA
Real Property Listserv <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal style="BACKGROUND: whitesmoke"><B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'>Subject:</SPAN></B><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Tahoma",sans-serif; COLOR: black'> Re:
[WSBARP] REET tax and change of cotnrolling
interest<o:p></o:p></SPAN></P></DIV></DIV></DIV>
<DIV>
<P class=MsoNormal><SPAN
style="FONT-SIZE: 12pt; COLOR: black"> <o:p></o:p></SPAN></P></DIV></DIV>
<DIV>
<P class=MsoNormal><SPAN style="COLOR: black">Joshua, I am not following your
math. Could you clarify?<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN style="COLOR: black"> <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 13pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>Rod
Harmon</SPAN><SPAN style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><B><SPAN
style='FONT-SIZE: 13pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'> </SPAN></B><SPAN
style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><B><SPAN
style='FONT-SIZE: 13pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>RODNEY
T. HARMON</SPAN></B><SPAN style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><B><SPAN
style='FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
Attorney at Law</SPAN></B><SPAN style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
P.O. Box 1066</SPAN><SPAN style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
Bothell, WA 98041</SPAN><SPAN
style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
Tel: (425) 402-7800</SPAN><SPAN
style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
Fax: (425) 458-9096</SPAN><SPAN
style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
<A href="http://www.rodharmon.com">www.rodharmon.com</A></SPAN><SPAN
style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: #1f497d'>
<A>rodharmon@msn.com</A></SPAN><SPAN style="COLOR: black"><o:p></o:p></SPAN></P>
<P class=MsoNormal style="MARGIN-TOP: 6pt"><SPAN
style="COLOR: black"> <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN style="COLOR: black"> <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN style="COLOR: black"> <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN style="COLOR: black"> <o:p></o:p></SPAN></P>
<DIV>
<DIV
style="BORDER-TOP: #e1e1e1 1pt solid; BORDER-RIGHT: medium none; BORDER-BOTTOM: medium none; PADDING-BOTTOM: 0in; PADDING-TOP: 3pt; PADDING-LEFT: 0in; BORDER-LEFT: medium none; PADDING-RIGHT: 0in">
<P class=MsoNormal><B><SPAN style="COLOR: black">From:</SPAN></B><SPAN
style="COLOR: black"> <A>wsbarp-bounces@lists.wsbarppt.com</A> <B>On Behalf Of
</B>Josh Grant<BR><B>Sent:</B> Wednesday, June 1, 2022 3:48 PM<BR><B>To:</B>
wsbar <<A>wsbarp@lists.wsbarppt.com</A>><BR><B>Subject:</B> [WSBARP] REET
tax and change of cotnrolling interest<o:p></o:p></SPAN></P></DIV></DIV>
<P class=MsoNormal><SPAN style="COLOR: black"> <o:p></o:p></SPAN></P>
<DIV>
<DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">Mom and dad own
48% (25% each) of an LLC with a $1,000,000 parcel of real estate. The kdis own
the rest.</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">Mom and Dad
gifted their 48% to the kids so now the kids each own 25% of the LLC
each.</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">No sale all
gifts.</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">Please confirm
that the Controlling Interest Transfer, in this case where there is no sale.. is
not triggered. </SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style="FONT-SIZE: 13.5pt; COLOR: black">Thanks</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV>
<DIV>
<DIV>
<DIV>
<DIV>
<P class=MsoNormal><STRONG><SPAN
style='FONT-SIZE: 18pt; FONT-FAMILY: "Calibri",sans-serif; COLOR: #004080'>Joshua
F. Grant</SPAN></STRONG><SPAN
style="FONT-SIZE: 14pt; COLOR: #004080"><BR></SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><IMG id=Picture_x0020_1
style="HEIGHT: 0.447in; WIDTH: 2.156in" border=0 alt=advocates
src="cid:77B3C0A36AA54345861180D727FFB0E3@JoshPC" width=207
height=43></SPAN><SPAN style="FONT-SIZE: 14pt; COLOR: black"><BR></SPAN><SPAN
style="COLOR: #004080">P. O. Box 619<BR>Wilbur, WA 99185<BR>509 647
5578</SPAN><SPAN
style="FONT-SIZE: 14pt; COLOR: black"><o:p></o:p></SPAN></P></DIV></DIV></DIV></DIV></DIV></DIV>
<DIV class=MsoNormal style="TEXT-ALIGN: center" align=center><SPAN
style="FONT-SIZE: 12pt; COLOR: black">
<HR align=center SIZE=2 width="100%">
</SPAN></DIV>
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