Bulletin: NY000627a

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Bulletin: NY000627a

Note: This Bulletin has been replaced by NY000630 - Update regarding NYS Law Chapter 297: Transfer Tax Returns for Residential Properties. Use it for reference only.

Bulletin Document
V 1
Date: September 23, 2019
To: All New York State Agents, Office Counsel, and Managers
RE: NYS Law Chapter 297: Transfer Tax Returns for Residential Properties

This is an update to Bulletin NY000627, in that typographical errors in the Transfer Tax LLC Information Disclosure Form at the link below have been corrected.

On September 13, 2019, the State of New York enacted Chapter 297 of the Laws of 2019, which amends New York Tax Law § 1409(a) and adds a new subdivision (h) to § 11-205 of the NYC Administrative Code.

While the full text of the Act is appended hereto, in summary, the Act requires that transfer tax returns for the sale of a residential 1-4 family, be they NYC or State, to be:

accompanied by a document which identifies the names and business addresses of all members, managers, and any other authorized persons, if any, of such limited liability company and the names and business addresses or, if none, the business addresses of all shareholders, directors, officers, members, managers and partners of any limited liability company or other business  entity that are to be the members, managers or authorized persons, if any, of such limited liability company.  The identification of such names and addresses shall not be deemed an unwarranted invasion of personal privacy pursuant to article six of the public officers’ law.  If any such member, manager or authorized person of the limited liability company is itself a limited liability company or other business entity, the names and addresses of the shareholders, directors, officers, members, managers and partners of the limited liability company or other business entity shall also be disclosed until full disclosure of ultimate ownership by natural persons is achieved. For purposes of this subdivision, the terms “members”, “managers”, “authorized person", "limited liability company" and "other business entity" shall have the same meaning as those terms are defined in section one hundred two of the limited liability company law.

Note that the act appears to apply only to residential 1-4 family properties, but according to the answers to specific questions put to the bill sponsors’ staff immediately prior to the Governor’s signing, it is also intended to apply to single condominium units and single co-op apartments.

Further, the information to be supplied is for both grantors and grantees.

Further still, the act takes effect “immediately.”  We are hearing that County Clerks have begun to enforce the Act, though no form has been provided by the City or State taxing authorities.  Until these authorities do so, Stewart is recommending that you use the attached Transfer Tax LLC Information Disclosure Form or similar document.  If any party should have this form rejected by a County Clerk, please let Stewart know immediately. 

Finally, to avoid surprise and conflict at closing, it is recommended that the following exception be placed in all title reports:

EXCEPTION/REQUIREMENT:

This Company is required by New York City and State Law to collect certain additional information from you and the parties representing you regarding the purchase of real property. Chapter 297 of the Laws of 2019 requires the collection of information regarding the purchaser or seller of a residential 1-4 property or single co-op/condominium unit, where that purchaser or seller is a limited liability company.  You may be required, as a condition of the issuance of the policy to provide additional information that will be reported along with the filing of the State or New York city transfer tax return. Please contact this company and provide the details of this transaction in order to comply with this requirement and avoid delays at closing.

In the event you have any questions regarding the above please contact Stewart Title Legal Department at 212-922-0050 and speak with any Underwriting Counsel.

The Transfer Tax LLC Disclosure Form is available on www.stewart.com/new-york under the Legal Forms-Transfer Tax and Returns section

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.

Forms: Transfer Tax LLC Information Disclosure Form
Attachments: Chapter 297 of the Laws of 2019

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.


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