June 25th, 2020 1:00 PM by Diane DeFaria LoVerde
If you live in the city of San Jose Measure E is an ADDITIONAL Transfer Tax applied at varying increments on sale of real property over $2 Million. Under Measure E, the Transfer Tax would be imposed whenever a deed, instrument, or writing, whether recorded or not, transfers real property in the City of San Jose for consideration. Again, this is in addition to the regular City and County Transfer taxes that currently apply within the City of San Jose.
Consideration means the amount paid for, or the value of, the transferred property and includes the amount of any debt and special assessments secured by the transferred property.
The Transfer Tax would also apply to a transfer of ownership interests in a legal entity (e.g., a corporation, partnership, or limited liability company) that would be considered an ownership change of real property under State law. Payment of the tax is the responsibility of the parties to the transfer and may be paid by either party.
Transfers under $2,000,000 would be exempt from this additional Transfer Tax. Transfers of $2,000,000 or more would be taxed at one of the following rates applied to the full value of the consideration:
Property Value Tax Rate
Less than $2,000,000 exempt from tax
$2,000,000 to $5,000,000 0.75%
$5,000,000.01 to $10,000,000 1.0%
$10,000,000.01 and higher 1.5%
For example, a transfer of real property where the value of consideration is $11,000,000 would be taxed at a rate of 1.5% on the entire $11,000,000. The tax owed would be $165,000.
The Transfer Tax includes other exemptions as well including transfers involving gifts, inheritance, divorce, and bankruptcy, in certain circumstances.
If you have any questions or have any other information you would like to share please contact me any time I am always happy to hear from you.
Diane LoVerde - Broker – CRS,GRI,GREEN,SRES
D&F Properties
408-221-6602
DRE # 00744960 / NMLS: #23435