New Jersey-2018-S1259-Introduced

An Act exempting senior, blind, and disabled citizens from the payment of certain fees on the transfer of title to real property, amending P.L.1975, c.176 and P.L.2004, c.66.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 4 of P.L.1975, c.176 (C.46:15-10.1) is amended to read as follows:

4. a. The following transfers of title to real property shall be exempt from payment of [the State portion of the basic fee] fees imposed under P.L.1968, c.49 (C.46:15-5 et seq.) to the extent specified:

(1) The sale of any one- or two-family residential premises which are owned and occupied by a senior citizen, blind person or disabled person who is the seller in such transaction shall be exempt from (a) the State portion of the basic fee and (b) the general purpose fee; provided, however, that except in the instance of a husband and wife no exemption shall be allowed if the property being sold is jointly owned and one or more of the owners is not a senior citizen, blind person or disabled person.

(2) The sale of low and moderate income housing shall be exempt from the State portion of the basic fee.

b. Transfers of title to real property upon which there is new construction shall be exempt from payment, with respect to all consideration therefor up to $150,000.00, of 80% of the State portion of the basic fee.

c. (1) The director shall promulgate rules, regulations and forms of certification or otherwise necessary to carry out the provisions of this section.

(2) No transfer shall be eligible for more than one exemption under this section.

d. The balance of the State portion of the basic fee and the additional fee collected on transfers subject to exemption under subsection b. of this section shall be remitted to the State Treasurer and shall be credited to the [Neighborhood Preservation Nonlapsing Revolving] New Jersey Affordable Housing Trust Fund established pursuant to P.L.1985, c.222 (C.52:27D-301 et al.), to be spent in the manner established under section 20 thereof (C.52:27D-320).

e. Subsections a. through d. of this section shall be without effect on and after the tenth day following a certification by the Director of the Division of Budget and Accounting in the Department of the Treasury pursuant to subsection b. of section 2 of P.L.1992, c.148 (C.46:15-10.2) [or subparagraph (ii) of subparagraph (b) of paragraph 2 of subsection b. of section 1 of P.L.1992, c.148 (C.13:19-16.1)].

(cf: P.L.2008, c.31, s.3)

2. Section 8 of P.L.2004, c.66 (C.46:15-7.2) is amended to read as follows:

8. a. In addition to all other fees imposed under P.L.1968, c.49 (C.46:15-5 et seq.), there is imposed a fee upon the grantee of a deed for the transfer of real property:

(1) that is classified pursuant to the requirements of N.J.A.C.18:12-2.2 as Class 2 "residential";

(2) (a) that includes property classified pursuant to the requirements of N.J.A.C.18:12-2.2 as Class 3A: "farm property (regular)" but only if the property includes a building or structure intended or suited for residential use, and

(b) any other real property, regardless of class, that is effectively transferred to the same grantee in conjunction with the property described in subparagraph (a) of this paragraph;

(3) that is a cooperative unit as defined in section 3 of P.L.1987, c.381 (C.46:8D-3); or

(4) that is classified pursuant to the requirements of N.J.A.C.18:12-2.2 as Class 4A "commercial properties" that is transferred for consideration in excess of $1,000,000 recited in the deed, which fee shall be an amount equal to 1 percent of the entire amount of such consideration, which fee shall be collected by the county recording officer at the time the deed is offered for recording and remitted to the State Treasurer not later than the 10th day of the month following the month of collection for deposit into the General Fund.

b. (1) The fee imposed by subsection a. of this section shall not apply to a deed if the grantee of the deed for the transfer of real property is an organization determined by the federal Internal Revenue Service to be exempt from federal income taxation pursuant to paragraph (3) of subsection (c) of section 501 of the federal Internal Revenue Code of 1986, 26 U.S.C. s.501.

(2) The fee imposed by subsection a. of this section shall not apply to a deed if the transfer of real property is incidental to a corporate merger or acquisition and the equalized assessed value of the real property transferred is less than 20% of the total value of all assets exchanged in the merger or acquisition. A grantee shall claim this exemption from imposition of the fee at the time the deed is offered for recording by filing with the county recording officer such information, in addition to the affidavit of consideration filed by one or more of the grantee parties named in the deed or by the grantee's legal representative pursuant to subsection d. of this section, as the Director of the Division of Taxation in the Department of the Treasury may prescribe as to constitute a filing of a protest of the assessment of the fee and by paying any other recording fees not exempted pursuant to this paragraph. This additional information shall be forwarded by the county recording officer to the director along with the grantee's affidavit of consideration, and shall be deemed to be and have the effect of a protest of a finding by the director of a deficiency of payment of the fee filed on the date on which the deed is recorded.

(3) The fee imposed by subsection a. of this section shall not apply to a deed for the transfer of one- or two-family residential premises if the grantee of the deed is a senior citizen, blind person or disabled person.

c. The fee imposed by subsection a. of this section shall be subject to the provisions of the State Uniform Tax Procedure Law, R.S.54:48-1 et seq.; provided however, that notwithstanding the provisions of subsection a. of R.S.54:49-14, a taxpayer may file a claim under oath for refund at any time within 90 days after the payment of any original fee and that subsection b. of R.S.54:49-14 shall not apply to any additional fee assessed.

d. (1) If a transfer includes property classified pursuant to the requirements of N.J.A.C.18:12-2.2 as Class 4 property of any type, an affidavit of consideration shall be filed by one or more of the grantor parties named in the deed or by the grantor's legal representative declaring the consideration and shall be annexed to and recorded with the deed as a prerequisite for the recording of the deed. The filing of an affidavit of consideration pursuant to this paragraph shall be in addition to the filing, if any, pursuant to paragraph (2) of this subsection.

(2) Whether or not the transfer is exempt, pursuant to subsection b. of this section or any other provision of law, from payment of the fee pursuant to subsection a. of this section, if a transfer includes property otherwise subject to subsection a. of this section, then an affidavit of consideration shall be filed by one or more of the grantee parties named in the deed or by the grantee's legal representative declaring the consideration and shall be annexed to and recorded with the deed as a prerequisite for the recording of the deed. The filing of an affidavit of consideration pursuant to this paragraph shall be in addition to the filing, if any, pursuant to paragraph (1) of this subsection.

(3) An affidavit of consideration filed pursuant to paragraph (1) or paragraph (2) of this subsection shall clearly and entirely state the consideration, the county and municipality in which the property is situate, and the block and lot description of the real property conveyed.

(4) One copy of each affidavit of consideration filed and recorded with deeds pursuant to this subsection shall be forwarded by the county recording officer to the Director of the Division of Taxation in the Department of the Treasury on the tenth day of the month following the month of the filing of the deed.

(cf: P.L.2006, c.33, s.1)

3. This act shall take effect immediately and apply to transfers of real property occurring on or after the first day of the second calendar month following the date of enactment.

STATEMENT

This bill exempts the sale of owner-occupied residential property by senior, blind, and disabled citizens from the general purpose fee, one of the fees levied on the transfer of title to real property, which are collectively known as the realty transfer fee. Established pursuant to P.L.2004, c.66, the general purpose fee is imposed on the seller of non-exempt real property whose selling price equals or exceeds $350,000. It applies to the full amount of the property sale and has the following schedule: $0.90 on each $500 of consideration on the first $550,000 of the value recited in the deed of transfer; $1.40 on each $500 of consideration between $550,000 and $850,000; $1.90 on each $500 of consideration between $850,000 and $1,000,000; and $2.15 on each $500 of consideration over $1,000,000. The State General Fund is credited with all the proceeds from this fee. A senior, blind or disabled resident selling his or her abode for $650,000, for example, would thus pay $1,400 in realty transfer fees, a reduction of $1,270, or 47.6 percent, from the current $2,670 liability.

The bill also exempts the purchase of residential property by senior, blind, and disabled citizens from the one percent assessment imposed pursuant to P.L.2004, c.66 upon the recording of title to residential and commercial property selling for more than $1,000,000. A senior, blind or disabled resident acquiring a residential property for $1,500,000 would thus not have to pay $15,000 in fees.