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Frequently Asked Questions - Real Estate Transfer Tax (RETT)

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What is the Real Estate Transfer Tax (RETT)?

The RETT is a tax on the sale, granting, and transfer of real property or an interest in real property.  The statute imposing the tax is found at RSA 78-B and NH Code of Administrative Rules, Rev 800.  The tax is imposed on both the buyer and the seller at the rate of $.75 per $100 of the price or consideration for the sale, granting, or transfer.

What types of transactions are taxable?

All contractual transfers are subject to tax unless specifically exempt under RSA 78-B:2.  Examples of contractual transfers include:

  • Sales of land and buildings.
  • Transfers between a business entity and its owners.
  • Transfers between related business entities.
  • Transfers from the state of NH, a county, municipality, or other political subdivision of the state. In such circumstances the tax applies only to the buyer.
  • Transfers with the U.S. government or with any of its agencies, instrumentalities or any government corporation that is specifically exempt from state tax per federal law. In such circumstances, the tax only applies to the counterparty, and not to the U.S. government.
  • Sale or granting of a right-of-way or an easement on property.
  • Transfers through foreclosure or by deed in lieu of foreclosure.
  • Leases of real estate for 99 years or longer, inclusive of renewal rights whether exercised or not.
  • Transfers through deed issued as a result of a sheriff's sale.
  • Transfers of standing timber or exclusive rights to extract soil, gravel, minerals or other like materials from the land of another.
  • Transfers of interests in time-share properties.
  • Transfers of interests in real estate holding companies.

IRC § 1031 like-kind exchanges and other real estate for real estate swaps.

On what is the tax based?

For most arms length transactions, the tax is based on the actual price or consideration agreed to by the parties.

  • For transactions in which the consideration paid is $4,000 or less, the minimum tax is due ($20 from the buyer and $20 from the seller).
  • For transactions between related parties in which the consideration stated is unsupported, the tax will be assessed on the fair market value of the property.
  • For exchanges involving property or services, the tax is based on fair market value.

For transfers of interests in holding companies, the tax is based on the fair market value of the interest attributable to New Hampshire real estate.

What is fair market value?

Fair market value is the price the property would command in an arm's length transaction between a willing buyer and a willing seller.

What are related parties?

The term "related parties" encompasses individuals related by blood or law, individuals and the entities they own, and entities sharing common ownership, directly or indirectly.

What is a real estate holding company?

A real estate holding company is an organization which is engaged principally in owning, holding, selling, or leasing real estate and which owns real estate or an interest in real estate within the state.

Are there exceptions to the RETT?

Yes, among the exceptions are:

  • Non-contractual transfers.
  • Transfers between spouses pursuant to a final decree of divorce or nullity.
  • Filing of a deed or other instrument that corrects a deed.
  • Transfers to the state of NH, or a county, a municipality, or other political subdivision of the state of NH.
  • Transfers of cemetery plots.
  • Transfers that occur by devise, by intestate succession and descent, or by the death of a joint tenant.

What is a non-contractual transfer?

A non-contractual transfer is essentially a gift and is evidenced by the transferor's donative intent toward the transferee, actual delivery of the property to the transferee, and complete relinquishment of control over the property.

How is the transfer of manufactured housing taxed?

If the manufactured housing is stock-in-trade of a dealer engaged in the business of selling manufactured housing and the unit has not been previously occupied as a dwelling, then the initial sale of the unit by the dealer is not a taxable transfer under the RETT.
All other transfers of manufactured housing are potentially taxable transfers, and the tax is payable as follows:

  • If the manufactured housing remains in the same county within NH, the tax is to be paid by both the buyer and the seller to the register of deeds of the county in which the manufactured housing is located.
  • If the manufactured housing is relocated from one county to another county within NH, the tax is to be paid by both the buyer and the seller to the register of deeds of the county to which the manufactured housing is relocated.
  • If the manufactured housing is relocated into NH from another state, the tax is to be paid only by the buyer to the register of deeds of the county to which the manufactured housing is relocated.

If the manufactured housing is relocated from NH to another state, the tax is to be paid only by the seller to the register of deeds of the county from which the manufactured housing is relocated.

Is a transfer of real estate to my trust a taxable transfer?

Maybe.  A transfer to a revocable trust is a taxable transfer.  However, if the beneficial interest in the revocable trust is not represented by transferable shares and the trust is created and funded for estate planning purposes as a testamentary substitute, then the measure of the tax will be the minimum tax where:

  • The transfer is between the trust and its grantor.
  • The transfer is from the trust to the beneficiaries of the trust upon the death of the grantor.
  • The transfer is from the trust to a beneficiary who is the natural object of the grantor's bounty.
  • The transfer is from a trustee to a successor trustee of the same trust.

A transfer to or from an irrevocable trust is not taxable if the elements of a gift are satisfied. If the transfer does not satisfy the requirements for a gift, then the transfer is treated as a contractual transfer.

How do I pay the RETT?

The buyer and seller buy stamps from the register of deeds in the county where the property is located. The register affixes the stamps to the deed and the deed is recorded. This evidences publicly that tax was paid on the transfer and the amount paid.

Are there any other filings that must be made?

Yes, a Declaration of Consideration by the Purchaser (Form CD-57-P or Form CD-57-HC-P) and a Declaration of Consideration by the Seller (Form CD-57-S or Form CD-57-HC-S), as well as an Inventory of Property Transfer (Form PA-34) must be filed with the Department within 30 days after the recording of the deed. These forms are available at each county register of deeds office, on the Department's website or by calling the Forms Line at (603) 230-5001.

Where can I find more information?

For more information call Central Tax Services at (603) 230-5920 or write the Audit Division, PO Box 457, Concord, NH 03302-0457.


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