Notes and other written obligations to pay money 4. Florida imposes a transfer tax on the transfer of real property in Florida. Exceptions to the Documentary Tax. There is a doc stamp of $3.50 per thousand and an intangible tax of $2.50 per thousand required on every refinance in Florida. Documentary Stamp Tax: Pursuant to §201.02, Florida Statutes, subject only to a few specifically enumerated exceptions beyond the scope of this article, documentary stamp tax is due on instruments conveying an interest in real property at the rate of 70 cents per $100.00 of consideration (e.g., on a $100,000.00 sale, the documentary stamp tax due is $700.00). Florida Stamp Tax Attorney Regarding the Documentary Stamp Tax. The Florida documentary stamp (âpromise to payâ) tax is due in the amount of $.35 on every $100 (or fraction thereof) of indebtedness secured by a mortgage on Florida ⦠Most practitioners will tell you that a promissory note cannot be enforced in court unless the documentary stamp taxes are paid, and there is case law supporting this. No probate is needed for either asset to pass to intended heirs. In Florida we have what is called a "document stamp tax". Section 201.02 of the Florida Statutes governs certain transfers or conveyances that are subject to documentary stamp taxes. Deeds 2. by Mark (Florida, USA) Ask Kate: Refinancing Advice - Documentary Stamp Tax Kate, I refinanced about 3 years ago in Florida. Florida imposes documentary stamp taxes on promissory notes and other written obligations to pay money. The court also noted that at least one of prior decision that is contrary to this conclusion dealt with the statute before it had this delineation between Subsections (a) and (b). DEDUCT YOUR 2010 HAITI CONTRIBUTIONS ON YOUR 2009 ... TAX COURT APPLIES HACKL TO LIMITED PARTNERSHIP INT... PROMISSORY NOTE ENFORCED WITHOUT DOC STAMPS [FLORIDA], PROBATE PROCEDURE FOR FILING LATE CLAIMS [FLORIDA]. If tax has been paid to the department pursuant to subparagraph (a)2., and the deed or other instrument conveying the interest in Florida real property with respect to which the tax was paid is subsequently recorded, a notation reflecting the prior payment of the tax must be made upon the deed or other instrument conveying the interest in Florida real property. Florida imposes a documentary stamp tax on deeds and other documents that transfer an interest in Florida real property. However, the sale of the house is contingent upon the buyer also paying $100,000 for the personal property that will be included in the sale. Florida Documentary Stamp Update - Florida Legislature Closes the Loophole for the Drop and Swap Documentary Stamp Tax Avoidance Technique August 12, 2009 Effective July 1, 2009, Florida Statutes Section 201.02 was modified to eliminate the so-called âdrop and swapâ technique frequently used to avoid Florida documentary stamp taxes on the The 2017 Florida Statutes Chapter 201.02(a) provides the applicable tax rates for most instruments related to real property or interests in real property, and Chapters 201.17-201.20 set forth the penalties for failing to pay the required tax, illegally using stamps, and illegally avoiding taxes. Floridaâs Documentary Stamp Tax Requirement. Florida imposes a documentary stamp tax of 70 cents ($1.00 in Miami-Dade) per $100 of the purchase consideration for the sale of real estate located in Florida. They are the Florida documentary stamp (âpromise to payâ) tax and the Florida non-recurring intangible personal property tax. This tax would apply to the following: 1. Common examples of documents subject to the stamp tax ⦠Despite its long history, the Documentary Stamp Tax has continued to receive updates and shows no signs of being repealed in the future. Florida requires payment of a documentary stamp tax on every promissory note made, executed, delivered, sold, transferred or assigned in the state at a rate of 35 cents for every $100 of indebtedness on the note. 83-220; inapplicability of 10-cent tax increase by s. 2, ch. Bonds (original issuance); 4. Any taxpayer who paid $20,000 or more in documentary stamp tax during the most recent state fiscal year is required to pay electronically during the next calendar year. 2020 Documentary Stamp Tax Register online at www.floridabankers.comor complete this form and send to Florida Bankers Association, 1001 Thomasville ⦠(Example: $50,051 rounds to $50,100 multiplied by 0.007, equals $350.70) Documentary Stamp Tax ⦠Documentary stamp tax is levied at the rate of $.70 per $100 (or portion thereof) on documents that transfer interest in Florida real property, such as warranty deeds and quit claim deeds. 1. Those who are tempted to skimp on paying the intangible tax and not record the mortgage should realize that lenders routinely oppose such plans because it prevents the obligation contained in the note from being collateralized by the underlying property. The purpose of the proposed amendments to Rule 12B-4.014, Florida Administrative Code (F.A.C.) The amount of this tax is equal to $0.35 per $100 of the face value of the promissory note. Example: If the buyer of our $1,000,000 property has borrowed $700,000 from a bank to finance the purchase, then the buyer will be responsible for the payment of a documentary stamp tax in the amount of $2,450 at closing. (The Miami-Dade County rate is $.60 on all documents plus $.45 surtax on documents transferring anything other than a single-family residence). Hank transfers a Florida beach house valued at $1 million with a $750,000 mortgage balance to a LLC that is 100% owned by him. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply. He can be reached at (954) 489-4719 or weaverlawfirm@gmail.com. 34/04 : Development 12B-4.014 About the Author: Jefferson H. Weaver is an attorney in Fort Lauderdale, Florida, whose practice is concentrated in the areas of commercial and residential real estate and corporate law. When a taxable document is not recorded, the tax must be paid directly to the Florida Department of Revenue. Documents subject to the tax include: 1. Buyers of real estate are not necessarily out of the woods in avoiding the imposition of documentary stamp taxes because they may need to finance the purchase of their property. Florida Documentary Stamps: Ways to Avoid the Traps; Beware Real Estate Doc Stamp Tax Traps By: Raymond J. Bowie, Esq. The court went on to restrict its prior decisions on the subject to the extent there were inconsistent with this interpretation. The Department of Revenue is always keen to squash anyone wishing to trifle with their tax revenues so there is the possibility (however remote) that they would contest the stated value of the personal property and try to charge the $700 in saved tax plus any penalties and interest. The documentary stamp tax also applies to mortgages and liens against real estate. DOCUMENTARY STAMP TAX The documentary stamp tax is an excise tax levied on documents, instruments, loan agreements and papers evidencing the acceptance, assignment, sale or transfer of an obligation, rights, or property incident thereto. Which Documents Require Documentary Stamp Tax? Refinancing Advice Documentary Stamp Tax. However, if you have been recently married, you may be able to transfer property to your partner within the first year of marriage without having to pay the documentary stamp tax. This does not guarantee that the Department of Revenue will leave the Seller alone, but it gives the Seller a credible defense if he or she needs to respond to an audit. Property taxes are due in November. Documentary stamp tax is levied at the rate of $.70 per $100 (or portion thereof) on documents that transfer interest in Florida real property, such as warranty deeds and quit claim deeds. â The 10-cent tax increase in the documentary stamp tax levied by s. 2, chapter 92-317, does not apply to deeds and other taxable instruments relating to real property located in any county that has implemented the provisions of chapter 83-220, Laws of Florida, as amended by chapters 84-270, 86-152, and 89-252, Laws of Florida. Mortgages, liens, and other evidences of indebtedness The information on this blog is of a general nature and is not intended to answer any individual’s legal questions.