[Adopted 8-16-1982 by Ord. No. 82-4; amended in its entirety at time of adoption of Code (see Ch. 1,
General Provisions, Art. I)]
This article shall be known as the "Realty Transfer
Tax Ordinance of Borough of Riverside."
A realty transfer tax for general revenue purposes is hereby
imposed upon the transfer of real estate or interest in real estate
situated within the Borough of Riverside, regardless of where the
documents making the transfer are made, executed or delivered or where
the actual settlements on such transfer took place, as authorized
by Article XI-D, Local Real Estate Transfer Tax, 72 P.S. § 8101-D
et seq.
The tax imposed under § 257-2 and all applicable interest and penalties shall be administered, collected and enforced under the Act of December 31, 1965 (P.L. 1257, No. 511, as amended), known as the "Local Tax Enabling Act;"[1] provided that if the correct amount of the tax is not
paid by the last date prescribed for timely payment, the Borough of
Riverside, pursuant to Section 1102-D of the Tax Reform Code of 1971
(72 P.S. § 8102-D), authorizes and directs the Department
of Revenue of the Commonwealth of Pennsylvania to determine, collect
and enforce the tax, interest and penalties.
[1]
Editor's Note: See 53 P.S. § 6901 et seq. and 53
P.S. § 6924.101 et seq.
As used in this article, the following terms
shall have the meanings indicated:
A partnership, limited partnership or any other form of unincorporated
enterprise owned or conducted by two or more persons other than a
private trust or decedent's estate.
Any natural person, association, copartnership, firm or corporation.
Any deed, instrument or writing which conveys, transfers, devises, vests, confirms or evidences any transfer or devise of title to real estate, but does not include wills, mortgages, deeds of trust or other instruments of like character given as security for a debt and deeds of release thereof to the debtor, land contracts whereby the legal title does not pass to the grantee until the total consideration specified in the contract has been paid, or any cancellation thereof, unless the consideration is payable over a period of time exceeding 30 years, or instruments which solely grant, vest or confirm a public utility easement. "Document" shall also include a declaration of acquisition required to be presented for recording under § 257-9 of this article.
A corporation of which at least 75% of its assets are devoted
to the business of agriculture and at least 75% of each class of stock
of the corporation is continuously owned by members of the same family.
The business of agriculture shall include the leasing to members of
the same family of property which is directly and principally used
for agricultural purposes. The business of agriculture shall not be
deemed to include:
Recreational activities, such as but not limited to hunting,
fishing, camping, skiing, show competition or racing;
The raising, breeding or training of game animals or game birds,
fish, cats, dogs or pets or animals intended for use in sporting or
recreational activities;
Fur farming;
Stockyard and slaughterhouse operations; or
Manufacturing or processing operations of any kind.
A partnership of which at least 75% of its assets are devoted
to the business of agriculture and at least 75% of the interests in
the partnership are continuously owned by members of the same family.
The business of agriculture shall include the leasing to members of
the same family of property which is directly and principally used
for agricultural purposes. The business of agriculture shall not be
deemed to include:
Recreational activities, such as but not limited to hunting,
fishing, camping, skiing, show competition or racing;
The raising, breeding or training of game animals or game birds,
fish, cats, dogs or pets or animals intended for use in sporting or
recreational activities;
Fur farming;
Stockyard and slaughterhouse operations; or
Manufacturing or processing operations of any kind.
Any trust, other than a business trust, intended as a will
substitute by the settlor, which becomes effective during the lifetime
of the settlor, but from which trust distributions cannot be made
to any beneficiaries other than the settlor prior to the death of
the settlor.
Any individual, such individual's brothers and sisters, the
brothers and sisters of such individual's parents and grandparents,
the ancestors and lineal descendants of any of the foregoing, a spouse
of any of the foregoing, and the estate of any of the foregoing. Individuals
related by the half-blood or legal adoption shall be treated as if
they were related by the whole-blood.
Any trust, other than a business trust or a living trust,
which takes effect during the lifetime of the settlor and for which
the trustees of the trust take title to property primarily for the
purpose of protecting, managing or conserving it until distribution
to the named beneficiaries of the trust. An ordinary trust does not
include a trust that has an objective to carry on business and divide
gains, nor does it either expressly or impliedly have any of the following
features: the treatment of beneficiaries as associates, the treatment
of the interests in the trust as personal property, the free transferability
of beneficial interests in the trust, centralized management by the
trustee or the beneficiaries, or continuity of life.
Every natural person, association or corporation. Whenever
used in any section prescribing and imposing a fine or imprisonment,
or both, the term "person," as applied to associations, shall include
the responsible members or general partners thereof, and as applied
to corporations, the officers thereof.
All lands, tenements or hereditaments within the Borough of
Riverside, including without limitation buildings, structures, fixtures,
mines, minerals, oil, gas, quarries, spaces with or without upper
or lower boundaries, trees, and other improvements, immovables or
interests which, by custom, usage or law, pass with a conveyance of
land, but excluding permanently attached machinery and equipment in
an industrial plant.
A condominium unit.
A tenant-stockholder's interest in a cooperative housing corporation,
trust or association under a proprietary lease or occupancy agreement.
A corporation or association which is primarily engaged in
the business of holding, selling or leasing real estate, 90% or more
of the ownership interest in which is held by 35 or fewer persons
and which:
Derives 60% or more of its annual gross receipts from the ownership
or disposition of real estate; or
Holds real estate, the value of which comprises 90% or more
of the value of its entire tangible asset holdings exclusive of tangible
assets which are freely transferable and actively traded on an established
market.
Any interest in real estate which endures for a period of time,
the termination of which is not fixed or ascertained by a specific
number of years, including without limitation an estate in fee simple,
life estate, or perpetual leasehold; or
Any interest in real estate enduring for a fixed period of years
but which, either by reason of the length of the term or the grant
of a right to extend the term by renewal or otherwise, consists of
a group of rights approximating those of an estate in fee simple,
life estate or perpetual leasehold, including without limitation a
leasehold interest or possessory interest under a lease or occupancy
agreement for a term of 30 years or more or a leasehold interest or
possessory interest in real estate in which the lessee has equity.
The making, executing, delivering, accepting, or presenting
for recording of a document.
In the case of any bona fide sale of real estate at arm's length
for actual monetary worth, the amount of the actual consideration
therefor, paid or to be paid, including liens or other encumbrances
thereon existing before the transfer and not removed thereby, whether
or not the underlying indebtedness is assumed, and ground rents, or
a commensurate part thereof where such liens or other encumbrances
and ground rents also encumber or are charged against other real estate,
provided that where such documents shall set forth a nominal consideration,
the value thereof shall be determined from the price set forth in
or actual consideration for the contract of sale;
In the case of a gift, sale by execution upon a judgment or
upon the foreclosure of a mortgage by a judicial officer, transactions
without consideration or for consideration less than the actual monetary
worth of the real estate, a taxable lease, an occupancy agreement,
a leasehold or possessory interest, any exchange of properties, or
the real estate of an acquired company, the actual monetary worth
of the real estate determined by adjusting the assessed value of the
real estate for local real estate tax purposes for the common level
ratio factor developed by the Pennsylvania Department of Revenue for
Pennsylvania realty transfer tax base calculations;
The actual consideration for or actual monetary worth of any
executory agreement for the construction of buildings, structures
or other permanent improvements to real estate between the grantor
and other persons existing before the transfer and not removed thereby
or between the grantor, the agent or principal of the grantor or a
related corporation, association or partnership and the grantee existing
before or effective with the transfer.
A.
Every person
who makes, executes, delivers, accepts or presents for recording any
document, or in whose behalf any document is made, executed, delivered,
accepted or presented for recording, shall be subject to pay for,
and in respect to the transaction or any part thereof, a tax at the
rate of 1/2 of 1% of the value of the real estate represented by such
document, which tax shall be payable at the earlier of the time the
document is presented for recording or within 30 days of acceptance
of such document or within 30 days of becoming an acquired company.
B.
The payment
of the tax imposed herein shall be evidenced by the affixing of an
official stamp or writing by the Recorder whereon the date of the
payment of the tax, amount of the tax and the signature of the collecting
agent shall be set forth.
C.
It is the
intent of this article that the entire burden of the tax imposed herein
on a person or transfer shall not exceed the limitations prescribed
in the Local Tax Enabling Act, Act of December 31, 1965, P.L. 1257,
53 P.S. § 6901 et seq. and 53 P.S. § 6924.101
et seq., so that if any other political subdivision shall impose or
hereafter shall impose such tax on the same person or transfer, then
the tax levied by the Borough of Riverside under the authority of
that Act shall, during the time such duplication of the tax exists,
except as hereinafter otherwise provided, be 1/2 of the rate, and
such 1/2 rate shall become effective without any action on the part
of the Borough of Riverside; provided, however, that the Borough of
Riverside and any other political subdivision which imposes such tax
on the same person or transfer may agree that, instead of limiting
their respective rates to 1/2 of the rate herein provided, they will
impose respectively different rates, the total of which shall not
exceed the maximum rate permitted under the Local Tax Enabling Act.
D.
Any tax imposed under § 257-2 that is not paid by the date the tax is due shall bear interest as prescribed for interest on delinquent municipal claims under the Act of May 16, 1923 (P.L. 207, No. 153), 53 P.S. § 7101 et seq., as amended, known as the "Municipal Claims and Tax Liens Act." The interest rate shall be the lesser of the interest rate imposed upon delinquent commonwealth taxes as provided in Section 806 of the Act of April 9, 1929 (P.L. 343, No. 176), 72 P.S. § 806, as amended, known as the "Fiscal Code," or the maximum interest rate permitted under the Municipal Claims and Tax Liens Act for tax claims.
The United States, the commonwealth, or any
of their instrumentalities, agencies or political subdivisions shall
be exempt from payment of the tax imposed by this article. The exemption
of such governmental bodies shall not, however, relieve any other
party to a transaction from liability for the tax.
A.
The tax imposed by § 257-2 shall not be imposed upon:
(1)
A transfer
to the commonwealth, or to any of its instrumentalities, agencies
or political subdivisions, by gift, dedication or deed in lieu of
condemnation or deed of confirmation in connection with condemnation
proceedings, or a reconveyance by the condemning body of the property
condemned to the owner of record at the time of condemnation, which
reconveyance may include property line adjustments, provided said
reconveyance is made within one year from the date of condemnation.
(2)
A document
which the Borough of Riverside is prohibited from taxing under the
Constitution or statutes of the United States.
(3)
A conveyance
to a municipality, township, school district or county pursuant to
acquisition by the municipality, township, school district or county
of a tax-delinquent property at Sheriff's sale or Tax Claim Bureau
sale.
(4)
A transfer
for no or nominal actual consideration which corrects or confirms
a transfer previously recorded, but which does not extend or limit
existing record legal title or interest.
(5)
A transfer
or division in kind for no or nominal actual consideration of property
passed by testate or intestate succession and held by cotenants; however,
if any of the parties take shares greater in value than their undivided
interest, tax is due on the excess.
(6)
A transfer
between husband and wife, between persons who were previously husband
and wife who have since been divorced, provided the property or interest
therein subject to such transfer was acquired by the husband and wife
or husband or wife prior to the granting of the final decree in divorce,
between parent and child or the spouse of such child, between brother
or sister or spouse of a brother or sister and brother or sister or
the spouse of a brother or sister, and between a grandparent and grandchild
or the spouse of such grandchild, except that a subsequent transfer
by the grantee within one year shall be subject to tax as if the grantor
were making such transfer.
(7)
A transfer
for no or nominal actual consideration of property passing by testate
or intestate succession from a personal representative of a decedent
to the decedent's devisee or heir.
(8)
A transfer
for no or nominal actual consideration to a trustee of an ordinary
trust where the transfer of the same property would be exempt if the
transfer was made directly from the grantor to all of the possible
beneficiaries that are entitled to receive the property or proceeds
from the sale of the property under the trust, whether or not such
beneficiaries are contingent or specifically named. A trust clause
which identifies the contingent beneficiaries by reference to the
heirs of the trust settlor as determined by the laws of the intestate
succession shall not disqualify a transfer from the exclusion provided
by this subsection. No such exemption shall be granted unless the
Recorder of Deeds is presented with a copy of the trust instrument
that clearly identifies the grantor and all possible beneficiaries.
(9)
A transfer
for no or nominal actual consideration to a trustee of a living trust
from the settlor of the living trust. No such exemption shall be granted
unless the Recorder of Deeds is presented with a copy of the living
trust instrument.
(10)
A
transfer for no or nominal actual consideration from a trustee of
an ordinary trust to a specifically named beneficiary that is entitled
to receive the property under the recorded trust instrument or to
a contingent beneficiary where the transfer of the same property would
be exempt if the transfer was made by the grantor of the property
into the trust to that beneficiary. However, any transfer of real
estate from a living trust during the settlor's lifetime shall be
considered for the purposes of this article as if such transfer were
made directly from the settlor to the grantee.
(11)
A
transfer for no or nominal actual consideration from a trustee of
a living trust after the death of the settlor of the trust or from
a trustee of a trust created pursuant to the will of a decedent to
a beneficiary to whom the property is devised or bequeathed.
(12)
A
transfer for no or nominal actual consideration from the trustee of
a living trust to the settlor of the living trust if such property
was originally conveyed to the trustee by the settlor.
(13)
A
transfer for no or nominal actual consideration from trustee to successor
trustee.
(14)
A
transfer for no or nominal actual consideration between principal
and agent or straw party or from or to an agent or straw party where,
if the agent or straw party were his principal, no tax would be imposed
under this article. Where the document by which title is acquired
by a grantee or agreement of value fails to set forth that the property
was acquired by the grantee from, or for the benefit of, his principal,
there is a rebuttable presumption that the property is the property
of the grantee in his individual capacity if the grantee claims an
exemption from taxation under this section.
(15)
A
transfer made pursuant to the statutory merger or consolidation of
a corporation or statutory division of a nonprofit corporation, except
where the Department reasonably determines that the primary intent
for such merger, consolidation or division is avoidance of the tax
imposed by this article.
(16)
A
transfer from a corporation or association of real estate held of
record in the name of the corporation or association where the grantee
owns stock of the corporation or an interest in the association in
the same proportion as his interest in or ownership of the real estate
being conveyed and where the stock of the corporation or the interest
in the association has been held by the grantee for more than two
years.
(17)
A
transfer from a nonprofit industrial development agency or authority
to a grantee of property conveyed by the grantee to that agency or
authority as security for a debt of the grantee or a transfer to a
nonprofit industrial development agency or authority.
(18)
A
transfer from a nonprofit industrial development agency or authority
to a grantee purchasing directly from it, but only if:
(a)
The grantee shall directly use such real estate for the primary purpose
of manufacturing, fabricating, compounding, processing, publishing,
research and development, transportation, energy conversion, energy
production, pollution control, warehousing or agriculture; and
(b)
The agency or authority has the full ownership interest in the real
estate transferred.
(19)
A
transfer by a mortgagor to the holder of a bona fide mortgage in default
in lieu of a foreclosure or a transfer pursuant to a judicial sale
in which the successful bidder is the bona fide holder of a mortgage,
unless the holder assigns the bid to another person.
(20)
Any
transfer between religious organizations or other bodies or persons
holding title for a religious organization if such real estate is
not being or has not been used by such transferor or for commercial
purposes.
(21)
A
transfer to a conservancy which possesses a tax-exempt status pursuant
to § 501(c)(3) of the Internal Revenue Code of 1954 [68A
Stat. 3, 26 U.S.C. § 501(c)(3)] and which has as its primary
purpose preservation of land for historic, recreational, scenic, agricultural
or open space opportunities or a transfer from such a conservancy
to the United States, the commonwealth or to any of their instrumentalities,
agencies or political subdivisions or any transfer from such a conservancy
where the real estate is encumbered by a perpetual agricultural conservation
easement as defined by the Act of June 30, 1981 (P.L. 128, No. 43),
known as the "Agricultural Area Security Law,"[1] and such conservancy has owned the real estate for at
least two years immediately prior to the transfer.
[1]
Editor's Note: See 3 P.S. § 901 et seq.
(22)
A
transfer of real estate devoted to the business of agriculture to
a family farm corporation by a member of the same family which directly
owns at least 75% of each class of the stock thereof.
(23)
A
transfer of real estate devoted to the business of agriculture to
a family farm partnership by a member of the same family, which family
directly owns at least 75% of the interests in the partnership.
(24)
A
transfer between members of the same family of an ownership interest
in a real estate company, family farm corporation or family farm partnership
which owns real estate.
(25)
A
transaction wherein the tax due is $1 or less.
(26)
Leases
for the production or extraction of coal, oil, natural gas or minerals
and assignments thereof.
B.
In order
to exercise any exclusion provided in this section, the true, full
and complete value of the transfer shall be shown on the statement
of value. A copy of the Pennsylvania realty transfer tax statement
of value may be submitted for this purpose. For leases of coal, oil,
natural gas or minerals, the statement of value may be limited to
an explanation of the reason such document is not subject to tax under
this article.
Except as otherwise provided in § 257-7, documents which make, confirm or evidence any transfer or devise of title to real estate between associations or corporations and the members, partners, shareholders or stockholders thereof are fully taxable. For the purposes of this article, corporations and associations are entities separate from their members, partners, stockholders or shareholders.
A.
A real
estate company is an acquired company upon a change in the ownership
interest in the company, however effected, if the change does not
affect the continuity of the company and, of itself or together with
prior changes, has the effect of transferring, directly or indirectly,
90% or more of the total ownership interest in the company within
a period of three years.
B.
With respect
to real estate acquired after February 16, 1986, a family farm corporation
is an acquired company when, because of voluntary or involuntary dissolution,
it ceases to be a family farm corporation or when, because of issuance
or transfer of stock or because of acquisition or transfer of assets
that are devoted to the business of agriculture, it fails to meet
the minimum requirements of a family farm corporation under this article.
C.
A family
farm partnership is an acquired company when, because of voluntary
or involuntary dissolution, it ceases to be a family farm partnership
or when, because of transfer of partnership interests or because of
acquisition or transfer of assets that are devoted to the business
of agriculture, it fails to meet the minimum requirements of a family
farm partnership under this article.
D.
Within
30 days after becoming an acquired company, the company shall present
a declaration of acquisition with the Recorder of each county in which
it holds real estate for the affixation of documentary stamps and
recording. Such declaration shall set forth the value of real estate
holdings of the acquired company in such county. A copy of the Pennsylvania
realty transfer tax declaration of acquisition may be submitted for
this purpose.
A.
Where
there is a transfer of a residential property by a licensed real estate
broker, which property was transferred to him within the preceding
year as consideration for the purchase of other residential property,
a credit for the amount of the tax paid at the time of the transfer
to him shall be given to him toward the amount of the tax due upon
the transfer.
B.
Where
there is a transfer by a builder of residential property which was
transferred to the builder within the preceding year as consideration
for the purchase of new, previously unoccupied residential property,
a credit for the amount of the tax paid at the time of the transfer
to the builder shall be given to the builder toward the amount of
the tax due upon the transfer.
C.
Where
there is a transfer of real estate which is leased by the grantor,
a credit for the amount of tax paid at the time of the lease shall
be given the grantor toward the tax due upon the transfer.
D.
Where
there is a conveyance by deed of real estate which was previously
sold under a land contract by the grantor, a credit for the amount
of tax paid at the time of the sale shall be given the grantor toward
the tax due upon the deed.
E.
If the
tax due upon the transfer is greater than the credit given under this
section, the difference shall be paid. If the credit allowed is greater
than the amount of tax due, no refund or carryover credit shall be
allowed.
In determining the term of a lease, it shall be presumed that
a right or option to renew or extend a lease will be exercised if
the rental charge to the lessee is fixed or if a method for calculating
the rental charge is established.
The tax herein imposed shall be fully paid and have priority
out of the proceeds of any judicial sale of real estate before any
other obligation, claim, lien, judgment, estate or costs of the sale
and of the writ upon which the sale is made, except the state realty
transfer tax, and the Sheriff, or other officer conducting said sale,
shall pay the tax herein imposed out of the first moneys paid to him
in connection therewith. If the proceeds of the sale are insufficient
to pay the entire tax herein imposed, the purchaser shall be liable
for the remaining tax.
A.
As provided
in 16 P.S. § 11011-6, as amended by Act of July 7, 1983
(P.L. 40, No. 21), the Recorder of Deeds shall be the collection agent
for the local realty transfer tax, including any amount payable to
the Borough of Riverside based on a redetermination of the amount
of tax due by the Commonwealth of Pennsylvania of the Pennsylvania
realty transfer tax, without compensation from the Borough of Riverside.
B.
In order
to ascertain the amount of taxes due when the property is located
in more than one political subdivision, the Recorder shall not accept
for recording such a deed unless it is accompanied by a statement
of value showing what taxes are due each municipality.
C.
On or
before the 10th of each month, the Recorder shall pay over to the
Borough of Riverside all local realty transfer taxes collected, less
2% for use of the county, together with a report containing the information
as is required by the Commonwealth of Pennsylvania in reporting collections
of the Pennsylvania realty transfer tax. The two-percent commission
shall be paid to the county.
D.
Upon a
redetermination of the amount of realty transfer tax due by the Commonwealth
of Pennsylvania, the Recorder shall rerecord the deed or record the
additional realty transfer tax form only when both the state and local
amounts and a rerecording or recording fee has been tendered.
Every document lodged with or presented to the Recorder of Deeds
for recording shall set forth therein and as a part of such document
the true, full and complete value thereof or shall be accompanied
by a statement of value executed by a responsible person connected
with the transaction showing such connection and setting forth the
true, full and complete value thereof or the reason, if any, why such
document is not subject to tax under this article. A copy of the Pennsylvania
realty transfer tax statement of value may be submitted for this purpose.
The provisions of this section shall not apply to any excludable real
estate transfers which are exempt from taxation based on family relationship.
Other documents presented for affixation of stamps shall be accompanied
by a certified copy of the document and statement of value executed
by a responsible person connected with the transaction showing such
connection and setting forth the true, full and complete value thereof
or the reason, if any, why such document is not subject to tax under
this article.
A.
If any
part of any underpayment of tax imposed by this article is due to
fraud, there shall be added to the tax an amount equal to 50% of the
underpayment.
B.
In the
case of failure to record a declaration required under this article
on the date prescribed therefor, unless it is shown that such failure
is due to reasonable cause, there shall be added to the tax 5% of
the amount of such tax if the failure is for not more than one month,
with an additional 5% for each additional month or fraction thereof
during which such failure continues, not exceeding 50% in the aggregate.
The tax imposed by this article shall become a lien upon the
lands, tenements or hereditaments, or any interest therein, lying
or being situated, wholly or in part, within the boundaries of the
Borough of Riverside, which lands, tenements, hereditaments or interest
therein are described in or conveyed by or transferred by the deed
which is the subject of the tax imposed, assessed and levied by this
article, said lien to begin at the time when the tax under this article
is due and payable and continue until discharge by payment or in accordance
with the law, and the Solicitor is authorized to file a municipal
or tax claim in the Court of Common Pleas of Northumberland County,
in accordance with the provisions of the Municipal Claims and Liens
Act of 1923, 53 P.S. § 7101 et seq., its supplements and
amendments.
All taxes imposed by this article, together with interest and
penalties prescribed herein, shall be recoverable as other debts of
like character are recovered.
The Borough Council of the Borough of Riverside is charged with
enforcement and collection of the tax and is empowered to regulate
and enforce reasonable regulations for enforcement and collection
of the tax. The regulations which have been promulgated by the Pennsylvania
Department of Revenue under 72 P.S. § 8101-C et seq. are
incorporated into and made a part of this article.
