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<p class="MsoNormal"><span style="color:#002060">Dear All:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">WAC 458-61A-106 (1)(b) provides that "The transfer of a lessee's interest in a leasehold for valuable consideration is taxable
<u>to the extent the transfer includes any improvement constructed on leased land</u>. If the selling price of an improvement is not separately stated, or cannot otherwise be reasonably determined, the assessed value of the improvement as entered on the assessment
rolls of the county assessor will be used." (Emphasis mine). <o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">In my not so hypothetical, Lessor owned all of the real property and its improvements. Lessor leased to Lessee a portion of the real property and a portion of the improvements on that portion of the real property.
Lessee did not construct any improvements on the leased land. Ownership of the real property and ownership of the improvements were not conveyed to the Lessee.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">Lessee wants to assign its leasehold rights in the real property and the improvements to a Third Party. Because ownership of the improvements did not change hands, does WAC 458-61A-106 apply?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">Even if WAC 458-61A-106 does apply, does the fact that Lessee and the Third-Party are both not-for-profit organizations provide any exemption or other relief from the payment of excise or use tax on the transaction?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">Thanks.<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="color:#002060">Mark B. Anderson<br>
</span></b><span style="color:#002060">ANDERSON LAW FIRM PLLC<br>
821 Dock Street, Suite 209, PMB 4-12<br>
Tacoma, Washington 98402<br>
+1 253-327-1750<br>
+1 253-327-1751 (fax)<br>
<a href="mailto:marka@mbaesq.com"><span style="color:#002060">marka@mbaesq.com</span></a><br>
<a href="http://www.mbaesq.com/"><span style="color:#002060">www.mbaesq.com</span></a><b><o:p></o:p></b></span></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-family:"Arial Narrow",sans-serif;color:#002060">CONFIDENTIALITY NOTICE<br>
</span></b><span style="font-family:"Arial Narrow",sans-serif;color:#002060">This transmission is confidential and is intended solely for the use of the individual named recipient. It may be protected by the attorney-client privilege, work product doctrine,
or other confidentiality protection. If you are not the intended recipient, or the person responsible to deliver it to the intended recipient, be advised that any dissemination, distribution, or copying of this communication is prohibited. If you have received
this transmission in error, please immediately notify the sender via e-mail or by telephone at (253) 327-1750 that you have received the message in error, and then delete it. Thank you.<o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
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