HOUSE BILL No. 4405 March 6, 2001, Introduced by Reps. Jansen, Gosselin, Richardville, Raczkowski and Lemmons and referred to the Committee on Tax Policy. A bill to amend 1993 PA 330, entitled "State real estate transfer tax act," by amending section 6 (MCL 207.526), as amended by 2000 PA 203. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 6. The following written instruments and transfers of 2 property are exempt from the tax imposed by this act: 3 (a) A written instrument in which the value of the consider- 4 ation for the property is less than $100.00. 5 (b) A written instrument evidencing a contract or transfer 6 that is not to be performed wholly within this state only to the 7 extent the written instrument includes land lying outside of this 8 state. 9 (c) A written instrument that this state is prohibited from 10 taxing under the United States constitution or federal statutes. 00399'01 JLB 2 1 (d) A written instrument given as security or an assignment 2 or discharge of the security interest. 3 (e) A written instrument evidencing a lease, including an 4 oil and gas lease, or a transfer of a leasehold interest. 5 (f) A written instrument evidencing an interest that is 6 assessable as personal property. 7 (g) A written instrument evidencing the transfer of a right 8 and interest for underground gas storage purposes. 9 (h) Any of the following written instruments: 10 (i) A written instrument in which the grantor is the United 11 States, this state, a political subdivision or municipality of 12 this state, or an officer of the United States or of this state, 13 or a political subdivision or municipality of this state, acting 14 in his or her official capacity. 15 (ii) A written instrument given in foreclosure or in lieu of 16 foreclosure of a loan made, guaranteed, or insured by the United 17 States, this state, a political subdivision or municipality of 18 this state, or an officer of the United States or of this state, 19 or a political subdivision or municipality of this state, acting 20 in his or her official capacity. 21 (iii) A written instrument given to the United States, this 22 state, or 1 of their officers acting in an official capacity as 23 grantee, pursuant to the terms or guarantee or insurance of a 24 loan guaranteed or insured by the grantee. 25 (i) A conveyance from a husband or wife or husband and wife 26 creating or disjoining a tenancy by the entireties in the 27 grantors or the grantor and his or her spouse. 00399'01 3 1 (j) A conveyance from an individual to that individual's 2 child, stepchild, or adopted child. 3 (k) A conveyance from an individual to that individual's 4 grandchild, step-grandchild, or adopted grandchild. 5 (l) A judgment or order of a court of record making or 6 ordering a transfer, unless a specific monetary consideration is 7 specified or ordered by the court for the transfer. 8 (m) A written instrument used to straighten boundary lines 9 if no monetary consideration is given. 10 (n) A written instrument to confirm title already vested in 11 a grantee, including a quitclaim deed to correct a flaw in 12 title. 13 (o) A land contract in which the legal title does not pass 14 to the grantee until the total consideration specified in the 15 contract has been paid. 16 (p) A written instrument evidencing the transfer of mineral 17 rights and interests. 18 (q) A written instrument creating a joint tenancy between 2 19 or more persons if at least 1 of the persons already owns the 20 property. 21 (r) A transfer made pursuant to a bona fide sales agreement 22 made before the date the tax is imposed under sections 3 and 4, 23 if the sales agreement cannot be withdrawn or altered, or con- 24 tains a fixed price not subject to change or modification. 25 However, a sales agreement for residential construction may be 26 adjusted up to 15% to reflect changes in construction 27 specifications. 00399'01 4 1 (s) A written instrument evidencing a contract or transfer 2 of property to a person sufficiently related to the transferor to 3 be considered a single employer with the transferor under 4 section 414(b) or (c) of the internal revenue code of 1986, 26 5 U.S.C. 414. 6 (t) A written instrument conveying an interest in homestead 7 property for which a homestead exemption is claimed under section 8 7cc of the general property tax act, 1893 PA 206, MCL 211.7cc, if 9 the state equalized valuation of that homestead property is equal 10 to or lesser than the state equalized valuation on the date of 11 purchase or on the date of acquisition by the seller or trans- 12 feror for that same interest in property. If after an exemption 13 is claimed under this subsection, the sale or transfer of home- 14 stead property is found by the treasurer to be at a value other 15 than the true cash value, then a penalty equal to 20% of the tax 16 shall be assessed in addition to the tax due under this act to 17 the seller or transferor. 18 (u) A written instrument transferring an interest in prop- 19 erty pursuant to a foreclosure of a mortgage including a written 20 instrument given in lieu of foreclosure of a mortgage. This 21 exemption does not apply to a subsequent transfer of the fore- 22 closed property by the entity that foreclosed on the mortgage. 23 (v) A written instrument conveying an interest from a reli- 24 gious society in property exempt from the collection of taxes 25 under section 7s of the general property tax act, 1893 PA 206, 26 MCL 211.7s, to a religious society if that property continues to 00399'01 5 1 be exempt from the collection of taxes under section 7s of the 2 general property tax act, 1893 PA 206, MCL 211.7s. 3 (W) A WRITTEN INSTRUMENT TRANSFERRING AN INTEREST IN A PRI- 4 VATE SCHOOL. AS USED IN THIS SUBDIVISION, "PRIVATE SCHOOL" MEANS 5 A NONPUBLIC SCHOOL THAT OPERATES IN THIS STATE THAT IS EXEMPT 6 FROM TAXATION UNDER SECTION 501(c)(3) OF THE INTERNAL REVENUE 7 CODE OF 1986. 00399'01 Final page. JLB