Bill 564

                    Current Status

Bill Number:                    564
Ratification Number:            134
Act Number:                     73
Type of Legislation:            General Bill GB
Introducing Body:               Senate
Introduced Date:                19970320
Primary Sponsor:                Martin 
All Sponsors:                   Martin 
Drafted Document Number:        dka\4224ac.97
Date Bill Passed both Bodies:   19970515
Date of Last Amendment:         19970506
Governor's Action:              S
Date of Governor's Action:      19970610
Subject:                        Deed recording fee, liability for;
                                definitions, affidavits, and exemptions
                                for certain; Taxation, Property

Body    Date      Action Description                       Com     Leg Involved
______  ________  _______________________________________  _______ ____________

------  19970630  Act No. A73
------  19970610  Signed by Governor
------  19970604  Ratified R134
House   19970515  Read third time, enrolled for
                  ratification
House   19970514  Read second time
House   19970508  Introduced, read first time
Senate  19970507  Read third time, sent to House
Senate  19970506  Read second time, ordered to
                  third reading with notice of
                  general amendments
Senate  19970506  Committee amendment adopted
Senate  19970430  Committee report: Favorable with         11 SJ
                  amendment
Senate  19970320  Introduced, read first time,             11 SJ
                  referred to Committee

(A73, R134, S564)

AN ACT TO AMEND SECTION 12-24-20, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO LIABILITY FOR A DEED RECORDING FEE, SO AS TO PROVIDE THAT THE FEE IS OWED BY THE GRANTEES IN THE CASE OF A DEED FROM A MASTER-IN-EQUITY, FROM A GOVERNMENT OR ITS SUBDIVISIONS, OR FROM AN INTERNAL REVENUE CODE TAX-EXEMPT RETIREMENT PLAN; TO AMEND SECTION 12-24-30, RELATING TO THE DEFINITION OF "VALUE" AS IT CONCERNS A DEED RECORDING FEE, SO AS TO CLARIFY THE MEANING OF "VALUE" AND TO PROVIDE FOR THE ELECTION TO USE THE PROPERTY TAX ASSESSMENT OF FAIR MARKET VALUE FOR PURPOSES OF CHAPTER 24; TO AMEND SECTION 12-24-40, RELATING TO EXEMPTIONS FROM A DEED RECORDING FEE, SO AS TO DELETE AND CLARIFY CERTAIN EXEMPTIONS FROM THE RECORDING FEE ON DEEDS AND TO REDEFINE "FAMILY"; AND TO AMEND SECTION 12-24-70, RELATING TO AFFIDAVITS REQUIRED FOR RECORDING A DEED, SO AS TO PROVIDE FOR CONTENTS OF AFFIDAVITS FILED IN CONNECTION WITH EXEMPT DEEDS.

Be it enacted by the General Assembly of the State of South Carolina:

Liability for deed recording fee

SECTION 1. Section 12-24-20 of the 1976 Code, as added by Act 458 of 1996, is amended to read:

"Section 12-24-20. (A) Except as provided in subsection (B), the fee imposed by this chapter is the liability of the grantor, or the joint and several liability of the grantors, but the grantee is secondarily liable for the payment of the fee.

(B) In the case of a master-in-equity deed, a deed from the federal government, a state or any of a state's political subdivisions, or a qualified retirement plan exempt from income taxes under the Internal Revenue Code to another person, the fee imposed by this chapter is the liability of the grantee, or the joint and several liability of the grantees, and not the grantor."

"Value" defined

SECTION 2. Section 12-24-30 of the 1976 Code, as added by Act 458 of 1996, is amended to read:

"Section 12-24-30. (A) For purposes of this chapter, the term 'value' means the consideration paid or to be paid in money or money's worth for the realty including other realty, personal property, stocks, bonds, partnership interests, and other intangible property, the forgiveness or cancellation of a debt, the assumption of a debt, and the surrendering of a right. The fair market value of the consideration must be used in calculating the consideration paid in money's worth. Taxpayers may elect to use the fair market value of the realty being transferred in determining fair market value of the consideration under the provisions of this section. However, in the case of realty transferred between a corporation, a partnership, or other entity and its stockholder, partner, or owner, and in the case of realty transferred to a trust or as a distribution to a trust beneficiary, 'value' means the realty's fair market value.

(B) A deduction from value is allowed for the amount of any lien or encumbrance existing on the land, tenement, or realty before the transfer and remaining on the land, tenement, or realty after the transfer.

(C) Taxpayers may elect to use the fair market value as determined for property tax purposes in determining fair market value under the provisions of this section."

Exemptions from the deed recording fee

SECTION 3. Section 12-24-40 of the 1976 Code, as added by Act 458 of 1996, is amended to read:

"Section 12-24-40. Exempted from the fee imposed by this chapter are deeds:

(1) transferring realty in which the value of the realty, as defined in Section 12-24-30, is equal to or less than one hundred dollars;

(2) transferring realty to the federal government or to a state, its agencies and departments, and its political subdivisions, including school districts;

(3) that are otherwise exempted under the laws and Constitution of this State or of the United States;

(4) transferring realty in which no gain or loss is recognized by reason of Section 1041 of the Internal Revenue Code as defined in Section 12-6-40(A);

(5) transferring realty in order to partition realty, as long as no consideration is paid for the transfer other than the interests in the realty that are exchanged in order to effect the partition;

(6) transferring an individual grave space at a cemetery owned by a cemetery company licensed under Chapter 55 of Title 39;

(7) that constitute a contract for the sale of timber to be cut;

(8) transferring realty to a corporation, a partnership, or a trust as a stockholder, partner, or trust beneficiary of the entity or so as to become a stockholder, partner, or trust beneficiary of the entity as long as no consideration is paid for the transfer other than stock in the corporation, interest in the partnership, beneficiary interest in the trust, or the increase in value in the stock or interest held by the grantor. However, except for transfers from one family trust to another family trust without consideration, the transfer of realty from a corporation, a partnership, or a trust to a stockholder, partner, or trust beneficiary of the entity is subject to the fee, even if the realty is transferred to another corporation, a partnership, or trust;

(9) transferring realty from a family partnership to a partner or from a family trust to a beneficiary, as long as no consideration is paid for the transfer other than a reduction in the grantee's interest in the partnership or trust. A 'family partnership' is a partnership whose partners are all members of the same family. A 'family trust' is a trust in which the beneficiaries are all members of the same family. 'Family' means the grantor, the grantor's spouse, parents, grandparents, sisters, brothers, children, stepchildren, grandchildren, and the spouses and lineal descendant of any of them, and the grantor's and grantor's spouse's heirs under a statute of descent and distribution. A 'family partnership' or 'family trust' also includes charitable entities, other family partnerships and family trusts of the grantor, and charitable remainder and charitable lead trusts, if all the beneficiaries are charitable entities or members of the grantor's family. A 'charitable entity' means an entity which may receive deductible contributions under Section 170 of the Internal Revenue Code as defined in Section 12-6-40(A);

(10) transferring realty in a statutory merger or consolidation from a constituent corporation to the continuing or new corporation;

(11) transferring realty in a merger or consolidation from a constituent partnership to the continuing or new partnership;

(12) that constitute a corrective deed or a quitclaim deed used to confirm title already vested in the grantee, as long as no consideration is paid or is to be paid under the corrective or quitclaim deed."

Affidavits stating value or reason for exemption

SECTION 4. Section 12-24-70 of the 1976 Code, as added by Act 458 of 1996, is amended to read:

"Section 12-24-70. (A) The clerk of court or register of mesne conveyances shall require an affidavit showing the value of the realty to be filed with a deed.

For deeds exempt under the provisions of this chapter, the value is not required to be stated on the affidavit, but the affidavit must state the reason the deed is exempt from the fee. The affidavit required by this section must be signed by a responsible person connected with the transaction, and the affidavit must state that connection. The clerk of court or register of mesne conveyances, at his discretion, may waive the affidavit requirement.

(B) The clerk of court or register of mesne conveyances shall file these affidavits in his office.

(C) A person required to furnish the affidavit who wilfully furnishes a false or fraudulent affidavit is guilty of a misdemeanor and, upon conviction, must be fined not more than one thousand dollars or imprisoned not more than one year, or both."

Time effective

SECTION 5. This act takes effect upon approval by the Governor.

Approved the 10th day of June, 1997.