[Adopted 12-29-1986 by Ord. No. 242]
This article shall be known as the "The Quarryville Borough Realty Transfer Tax Ordinance."
This realty transfer tax is levied under authority of Article XI-D, entitled "Local Real Estate Transfer Tax," of the Pennsylvania Real Estate Transfer Tax Act, which is a new Article added by Act 77-1986 (Act of July 2, 1986, No. 77, P.L. 318) to the Pennsylvania Real Estate Transfer Tax Act, Act 14-1981 (Act of May 5, 1981, No. 14, P.L. 36) as amended. The Pennsylvania Real Estate Transfer Tax Act is codified at 72 P.S. § 8101-C et seq., and Article XI-D is codified at 72 P.S. § 8101-D et seq. This realty transfer tax is also levied under authority of the Local Tax Enabling Act, Act of December 31, 1965, P.L. 1257, as amended.
Editor's Note: See now 53 P.S. § 6924.101 et seq.
The following words, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:
- A partnership, limited partnership, or any other form of unincorporated enterprise owned or conducted by two or more persons.
- The Recorder of Deeds of Lancaster County, Pennsylvania, is hereby appointed collector of the tax levied by this article.
- A corporation, joint-stock association, business trust or banking institution, which is organized under the laws of the Commonwealth of Pennsylvania, the United States, or any other state, territory, foreign country, or dependency.
- Any deed, instrument or writing which conveys, transfers, demises, vests, confirms or evidences any transfer or demise of title to real estate within the municipality, 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 § 366-9 of this article.
- FAMILY FARM CORPORATION
- 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 not be deemed to include:
- (1) Recreational activities such as, but not limited to, hunting, fishing, camping, skiing, show competition or racing;
- (2) 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;
- (3) Fur farming;
- (4) Stockyard and slaughterhouse operations; or
- (5) Manufacturing or processing operations of any kind.
- MEMBERS OF THE SAME FAMILY
- Any individual, such individual's brothers and sisters, the brothers and sisters of such individual's parents and grandparents, the ancestors or 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.
- The Borough of Quarryville, Lancaster County, Pennsylvania.
- Every natural person, association, corporation, or entity of any kind. Whenever used in any clause 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.
- (1) Any lands, tenements or hereditaments, 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.
- (2) A condominium unit.
- (3) A tenant-stockholder's interest in a cooperative housing corporation, trust or association under a proprietary lease or occupancy agreement.
- REAL ESTATE COMPANY
- 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:
- (1) Derives 60% or more of its annual gross receipts from the ownership or disposition of real estate; or
- (2) 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.
- REAL ESTATE TRANSACTION
- The making, executing, delivering, accepting, or presenting for recording of a document.
- (1) 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
- (2) 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. 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.
- (1) 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 the document 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.
- (2) 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, value shall be the actual monetary worth of the real estate within the municipality, determined by adjusting the assessed value of the real estate for local real estate tax purposes for the common level ratio of assessed values to market values of the taxing district in which the municipality is located as established by the State Tax Equalization Board, or a commensurate part of the assessment where the assessment includes other real estate.
- (4) 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.
The singular shall include the plural and the masculine shall include the feminine and neuter.
A tax is hereby levied and imposed, for general municipal purposes, on every real estate transaction, at the rate of 1% of the value of the real estate represented by the document involved in the real estate transaction.
The tax shall be payable at the earlier of the time the document is presented for recording, within 30 days of acceptance of the document, or within 30 days of becoming an acquired company.
If the real estate is located partially within and partially outside the municipality, the tax shall be calculated on the value of the portion within the municipality.
The tax imposed hereunder shall be due and payable to the collector, as a joint and several liability, by 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. In the case of an acquired company, the company shall also have liability for payment of the tax. All such persons shall also be liable for any penalties imposed under this article.
It is the intent of this article that the entire burden of the tax imposed on a real estate transaction by the municipality and other political subdivisions shall not exceed the limitations prescribed in Section 8 of the Local Tax Enabling Act, 53 P.S. § 6908, so that if any other political subdivision imposes a tax on real estate transactions taxed under this article, the provisions of said Section 8 shall apply.
Editor's Note: See now 53 P.S. § 6924.311.
The payment of the tax imposed hereunder shall be evidenced by the collector affixing on the document an official stamp or writing setting forth the date of payment of the tax and amount of tax paid.
The United States, the Commonwealth of Pennsylvania, 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 real estate transaction from liability for the tax.
The tax imposed by this article shall not be imposed upon:
A transfer to the Commonwealth of Pennsylvania, 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.
A document which the municipality is prohibited from taxing under the Constitution or statutes of the United States.
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 sale or tax claim bureau sale.
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.
A transfer of division in kind for no or nominal actual consideration of property passed by testate or intestate succession and held by co-tenants; however, if any of the parties take shares greater in value than their undivided interest, tax is due on the excess.
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.
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.
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, whether or not such beneficiaries are contingent or specifically named. No such exemption shall be granted unless the collector is presented with a copy of the trust instrument that clearly identifies the grantor and all possible beneficiaries.
A transfer for no or nominal actual consideration from a trustee to a beneficiary of an ordinary trust.
A transfer for no or nominal actual consideration from trustee to successor trustee.
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 statement 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 subsection.
A transfer made pursuant to the statutory merger or consolidation of a corporation or statutory division of a nonprofit corporation, except where the municipality reasonably determines that the primary intent for such merger, consolidation or division is avoidance of the tax imposed by this article.
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.
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.
A transfer from a nonprofit industrial development agency or authority to a grantee purchasing directly from it, but only if:
The grantee shall directly use such real estate for the primary purpose of manufacturing, fabricating, compounding, processing, publishing, research and development, transportation, energy conservation, energy production, pollution control, warehousing or agriculture; and
The agency or authority has the full ownership interest in the real estate transferred.
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.
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 for commercial purposes.
A transfer to a conservancy which possesses tax exempt status pursuant to Section 501(c)(3) of the Internal Revenue Code of 1954 and which has as its primary purpose preservation of land for historic, recreational, scenic, agricultural or open space opportunities.
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.
A transfer between members of the same family of an ownership interest in a real estate company or family farm corporation.
A transaction wherein the tax due is $1 or less.
Leases for the production or extraction of coal, oil, natural gas or minerals, and assignments thereof.
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. 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 § 366-7, documents which make, confirm or evidence any transfer or demise 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 real estate company is an acquired company upon a change in the ownership interest in the company, however effected, if the change:
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, it fails to meet the minimum requirements of a family farm corporation under this article.
Within 30 days after becoming an acquired company, the company shall present a declaration of acquisition to the collector for recording and for the affixation of the official stamp or writing evidencing payment of the tax. Such declaration shall set forth the value of real estate holdings of the acquired company in the municipality.
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.
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.
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.
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.
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.
Every document lodged with or presented to the collector for recording shall set forth therein and as 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. The provisions of this section shall not apply to any excludable real estate transfers which are exempt from taxation based on family relationship, provided the relationship is specified in the deed, instrument or writing. Documents which are not to be recorded shall be presented to the collector and shall be accompanied by a certified copy of the document and 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. Evidence of payment shall be affixed to the original document and the certified copy. The certified copy and statement of value shall be filed with the collector.
It shall be unlawful for any person to:
Make, execute, deliver, accept, or present for recording or cause to be made, executed, delivered, accepted, or presented for recording any document without the full amount of tax thereon being duly paid;
Fail to record a declaration of acquisition, as required by this article;
Fraudulently affix to any document, any forged evidence of payment; or
Fail, neglect or refuse to comply with or violate other provisions of this article or any rules and regulations promulgated by the municipality under this article, or any rules and regulations of the Pennsylvania Department of Revenue to the extent applicable to the tax levied hereunder.
Any person violating any of the provisions of this § 366-12 shall be guilty of a summary offense.
A person who makes a false statement of value or declaration of acquisition, when he does not believe the statement or declaration to be true, is guilty of a misdemeanor of the second degree.
If any tax owing under the terms of this article shall not be paid when due, 10% of the amount of the tax shall be added and collected as an initial penalty for nonpayment or underpayment of the tax.
In addition, if any tax owing under the terms of this article shall not be paid when due, a penalty shall accrue on the amount of the unpaid tax at the rate of 1% per month or fractional part of a month, on the amount of the unpaid tax, from the due date until the amount of the tax is paid in full.
In addition, in the case of failure of any acquired company to record a declaration of acquisition, as required by this article, unless it is shown to the satisfaction of the municipality that such failure is due to reasonable cause, a penalty shall accrue on the amount of the unpaid tax at the rate of 5% per month or fractional part of a month, on the amount of the unpaid tax, from the due date until the amount of the tax is paid in full. This penalty shall be in addition to all other penalties, but shall not in the aggregate exceed 50% of the amount of the unpaid tax.
In addition, if any part of any underpayment of tax is due to fraud, there shall be added to the tax an amount equal to 50% of the underpayment.
In addition, if the municipality files suit in order to collect the amount of any tax not paid when due under this article, at the discretion of the court, any person liable for payment of the tax shall also be liable for reasonable attorneys' fees incurred by the municipality in prosecution of the suit.
No document upon which tax is imposed by this article shall at any time be made the basis of any action or other legal proceeding, nor shall proof thereof be offered or received in evidence in any court of this commonwealth, or recorded in the office of any Recorder of Deeds of any county of this commonwealth, unless the tax imposed hereunder shall have been paid in full and evidence of payment shall have been affixed thereto by the collector.
The tax imposed by this article, together with all penalties, shall be a lien against the real estate to which the document relates and, in the case of an acquired company, the real estate owned by the acquired company. The lien shall date from the time when the tax is due and payable and shall continue until discharged by payment in full of the tax, together with all penalties. In order to enforce the lien, the municipality may proceed under the Municipal Claims and Liens Act of 1923, 53 P.S. § 7101 et seq., or in any other appropriate manner.
The tax imposed under this article 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, and the sheriff, or other officer, conducting said sale shall pay the tax herein imposed out of the first monies 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.
In order to determine whether the proper amount of tax has been paid, without limiting any other rights of the municipality, the municipality shall have the right to review all documents or records relating to any real estate transaction or any related transactions, and to take such other steps as the municipality shall deem necessary or appropriate, including a review or audit of any documents or records of any party to a real estate transaction to determine the fair market value of the real estate or any other relevant matter as determined by the municipality. Upon request of the municipality, and at such place and time as specified by the municipality, any party shall make available to the municipality any documents or records requested by the municipality.
In the event any tax is not paid when due, the municipality may enforce payment of the tax, together with all penalties, by suit in assumpsit or any other appropriate means.
As provided in 16 P.S. § 11011-6, the Recorder of Deeds shall be the collection agent for this tax, without compensation from the municipality.
In order to ascertain the amount of taxes due when the property is located in more than one political subdivision, the collector shall not accept for recording any document unless it is accompanied by a statement of value showing what taxes are due each political subdivision.
On or before the 10th day of each month, the collector shall pay over to the municipality all taxes collected under this article, less 2% for use of the county, and shall also provide a report containing the information 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.
In accordance with Act 77-1986, any Recorder of Deeds who shall record any document upon which tax is imposed under this article without payment of tax as required under this article, as is indicated in the document or accompanying statement of value shall, upon summary conviction, be sentenced to pay a fine of $50 and costs of prosecution.
If any sentence, clause, section, or part of this article is for any reason found to be unconstitutional, illegal, or invalid, such unconstitutionality, illegality, or invalidity shall not affect or impair any of the remaining provisions, sentences, clauses, sections, or parts of this article. It is hereby declared as the intent of the municipality that the article would have been adopted had such unconstitutional, illegal, or invalid sentence, clause, section or part thereof not been included herein.
The municipality may promulgate and enforce reasonable rules and regulations for the interpretation, collection, and enforcement of the tax.
To the extent this article imposes a tax on a real estate transaction which is subject to the Commonwealth of Pennsylvania realty transfer tax imposed by Act 77-1986, and to the extent not inconsistent herewith or with rules or regulations adopted by the municipality, this article shall be interpreted in the same manner as Act 77-1986 and in accordance with regulations promulgated thereunder.
Editor's Note: See 72 P.S. § 8101-C et seq.
The provisions of this article, so far as they are the same as those of ordinances in force immediately prior to adoption of this article, are intended as a continuation of such ordinances, and not as new enactments.
This article shall impose a tax on all transactions which the municipality is permitted to tax under Act 77-1986 to the fullest extent permissible.
In the event this article is declared invalid, the prior ordinance or ordinances of the municipality levying a realty transfer tax shall remain in full force and effect, and shall not be affected in any way by adoption of this article.
The provisions of this article shall not affect any act done or liability incurred, nor shall they affect any suit or prosecution pending or to be instituted to enforce any right or penalty or to punish any offense under the authority of any ordinance in force prior to adoption of this article.