Real Estate Transfer Fee Common Questions

Choose a Topic
Adverse Possession	Agent	Agent to Principal	Affidavit of Correction	Bankruptcy
Boyfriend/Girlfriend	Condos (Condominiums, Dockominium, Garageominiums)	Confidentiality	Conversions	Corporations
Corrections (before Register of Deeds recording)	Corrections (after Register of Deeds recording)	Date of Conveyance	Deed of Trust	Deeds - Filing
Deeds - Multiple	Developers	Domestic Partners	Exchange in Property	Exempt from Filing Return
Farmland	Federal Revenue Stamp	Fees	Financing	Foreclosures
Gifts	General Partnerships	Government Agencies	Husband-Wife Conveyances	Joint Tenancy
Land Contracts	Lease	Legal Descriptions	Life Estates	Limited Liability Company (LLC)
Merger	Mineral Rights	Mobile Homes	Non-Profit Organizations	Parcels
Parent Child	Partition	Partnerships	Penalties	Personal Property
Railroads	Receipts	Refunds	Security for a Debt	Sheriff Sales
Short Sales	Social Security Numbers	Timber, Minerals, Air Rights	Timeshares	Transfer by Affidavit
Transfer Fee Miscellaneous	Transfer on Death Deed (TOD Deed)	Trustee Deed	Trusts	Value of Property (subject to transfer fee)
Weatherization	Will, Descent or Survivorship

Adverse Possession

1. If a court ordered judgment awards the plaintiff’s property due to adverse possession, does this need a transfer return?

Agent

1. When is the agent section of the transfer return required to be completed?
2. Does the agency portion of the return need to be completed if the grantor is an entity such as a trust, LLC, partnership, etc?

Agent to Principal

1. Buyer A and Buyer C intend to purchase two adjacent lots from Seller B. Because A and C do not want B to know that C is buying lot 2, A enters into a purchase agreement to buy the two adjacent lots from B and immediately transfer lot 2 to C. Can a transfer fee be avoided on the conveyance from A to C?

Affidavit of Correction

1. When recording the Affidavit of Correction in lieu of re-recording a previously recorded deed, do you need to file a transfer return?

Bankruptcy

1. Is a bankruptcy ordered conveyance of real estate exempt from transfer fee?
2. In closing a transaction under Chapter 11 of the Bankruptcy Code pursuant to 11 U.S.C. § 1146(a) how do you complete the transfer return?
3. In closing a transaction under Chapter 11 of the Bankruptcy Code pursuant to 11 U.S.C. § 1146(a), “the issuance, transfer, or exchange of a security, or the making or delivery of an instrument of transfer under a plan confirmed under section 1129 of this title, may not be taxed under any law imposing a stamp tax or similar tax.” Will a sale that is part of an overall plan and must be completed before the plan of reorganization is confirmed by the bankruptcy court still be exempt from transfer fee?  How do you fill out the transfer form?
4. Based on States of Illinois & Washington v. National Steel Corp., No. 03 C 3932 (N. D. Ill. Sept. 9, 2003), has the Department changed its interpretation of transfers that are exempt from the transfer fee under Chapter 11 of the Bankruptcy Code?

Boyfriend/Girlfriend

1. A girlfriend and boyfriend purchased a house together.  The mortgage is in the boyfriend’s name and is more than the value of the real estate.  Title is in both names.  Girlfriend is signing over her ½ interest to the boyfriend.  Are a return and a transfer fee due?

Condos (Condominiums, Dockominiums, Garageominiums)

1. Does a condo declaration amendment that relocates the boundaries between adjoining units require a transfer return?
2. If a condominium sells its units as “life estates” for $100,000 and at the time of sale they also sign a “Repurchase Agreement” whereby the condominium will purchase the “life estate” back for 90% of the $100,000. What transfer fees are due and at what values?
3. A condominium is selling its units as a 75 year lease for $100,000. Is a transfer return and fee due?

Confidentiality

1. What precautions are taken by the Wisconsin Department of Revenue to ensure the confidentiality of transfer returns when authorized individuals inspect them?

Conversions

1. Explain the filing requirements for mergers or conversions pursuant to sec. 73.14, Wis. Stats.
2. Delaware corporation registered to do business in Wisconsin converts to a Delaware LLC. Since Wisconsin corporate law doesn’t recognize a foreign conversion, the Delaware corporation will have to withdraw from doing business in Wisconsin and the converted entity (LLC) will have to register to do business in Wisconsin. Is the LLC required to file a MC-500 pursuant to sec. 73.14, Wis. Stats.?

Corporations

1. Does the exemption in sec. 77.25(7), Wis. Stats., apply to a transfer by a subsidiary corporation to its parent when its parent is a limited liability company?
2. Explain the 3 year requirement for the exemption in sec. 77.25(15), Wis. Stats., for corporations.
3. If a corporation deeds its property to the corporation's president for no consideration will a transfer fee apply?

Corrections (prior to eRETR being recorded by Register of Deeds)

1. Can you describe the RETR correction procedure:?
2. How do I file an Amended Real Estate Transfer Return (PE-500x) when I do not have a document number?

Corrections (after eRETR is recorded by Register of Deeds)

1. The assessor for “Big City” discovered that the eRETR for a conveyance of a parcel located in "Little Town" listed a municipality and parcel number that did not match the deed conveying property in. How does "Big City's" assessor correct this situation so the assessor of “Little Town” can view the sale?
2. How should a transfer return be completed when a deed is recorded correcting or reforming a previously recorded deed?
3. How do you correct a transfer return after it is recorded by the Register of Deeds?

Date of Conveyance

1. What is the difference between "Date Recorded" and "Date of Conveyance"?
2. How important is it that the “Date of Conveyance” on the eRETR and the date of the deed match?

Deed of Trust

1. Does a "Deed of Trust" need a transfer return when it is supposed to be similar to a real estate mortgage?

Deeds-Filing

1. How should a real estate transfer return be completed when the deed lists the person’s (or entity's) current name and alternate name or names?
2. Can a paper PE-500 be used to record any deed?

Deeds-Multiple

1. Will the Department still accept “one transaction – one return” where the Register of Deeds receives multiple deeds conveying different interests in the same property to the same grantee and there is only one receipt filed?

Developers

1. Developer (land owner) and builder (improvement owner) are selling to the same party. How many deeds can be used for this conveyance?
2. What is the Department’s position as to value subject to transfer fee on a conveyance of a vacant lot with a contract to construct a building?

Domestic Partners

1. What information is available for the Domestic Partner Fee Exemption – Sec. 77.25(8n), Wis. Stats.?
2. Does an employer’s extension of benefits to domestic partners qualify a conveyance between domestic partners for an exemption from transfer fee under sec. 77.25(8n), Wis. Stats.?
3. If a domestic partnership agreement is recorded in the county of primary residence, is a separate domestic partner recording required when placing the names of both domestic partners on the deed of a property located in a different county?

Exchange in Property

1. A buyer bought vacant lot 1 and then decides he wants lot 2 instead. The buyer is now going to trade lot 1 back to the seller in exchange for lot 2. There will be no adjustment to the original purchase price. Can both exchange deeds be exempted under sec. 77.25(3), Wis. Stats.?
2. Is a transfer fee due when trading vacant land for a four wheeler?
3. Explain the concept of property exchanges and what to do if one exchanged property has a higher value than the other.

Exempt from Filing Return

1. Under what circumstances may the Register of Deeds office accept deeds (instruments) without a transfer return?
2. Is a conveyance of a cemetery lot subject to a transfer return and fee?
3. Is a return needed for a name change if you are recently divorced and now want to have your prior name shown on the deed?
4. There are two adjoining parcels with two tax parcel Numbers. Before a garage can be built on the vacant parcel, the parcels need to be combined under one legal description for zoning purposes. Does a transfer return need to be completed when the deed is filed combining the lots?
5. If there is no statement on the document exempting the recording from a return, and the grantee’s agent is insisting the document is exempt from the fee and return, can the Register of Deeds record the document?
6. My neighbor and I had a new survey done and we need to record a deed that corrects the lot line between us. How do I complete the transfer return for a lot line correction?

Farmland

1. Can “Farmland Use Value” be used for Total value of REAL ESTATE when agricultural property is being conveyed?

Federal Revenue Stamp

1. If a deed has the Federal Revenue Stamps on it, how do you calculate the price paid for the property from these stamps?

Fees

1. Is the Department of Revenue responsible for paying fees to the Register of Deeds when requesting copies of documents

Financing

1. I am selling my house and am giving back a "second mortgage” which may or may not be forgiven. How is the transfer form filled out for “Grantees Financing”?

Foreclosures

1. Four people (2 couples) purchased real estate, with all 4 named as grantees on the deed.  One couple furnished the purchase price and made an agreement with the other couple to contribute.  The non-paying couple cannot pay and will quit claim to the paying couple.  Is this transaction exempt from fee as a deed in lieu of foreclosure?

Gifts

1. Is a gift of real estate to a university or college foundation that funds research and scholarships exempt from a transfer return and transfer fee under sec. 77.25(2g), Wis. Stats.?
2. If I give my nephew a house, is a transfer return and fee due?

General Partnerships

1. Is a quit claim deed for a conversion from a general partnership to the limited liability partnership subject to a transfer fee?
2. Is a quit claim deed from a general partnership to a limited liability company subject to a transfer fee?

Government Agencies

1. Are all sales to a governmental agency exempt from fee under sec. 77.25(12), Wis. Stats, pursuant to or in lieu of condemnation?
2. Is the following satisfaction of a land contract exempt per sec. 77.25(17), Stats? A city sells property to an individual on land contract and the transfer return (required since the transferor is the lender) was filed using Exemption (2). Later the city sells its vendor's interest in the land contract to another individual and records the assignment without a return as the vendor's interest is a personal interest in a debt. Now the deed in satisfaction is being recorded. Does Exemption (17) apply since the land contract was exempt and the current vendor is not a governmental agency?
3. When gifting property to a public school district, is this conveyance exempt from fee?
4. My company has just started handling the resale of properties foreclosed by Federal Home Loan Mortgage Corporation (Freddie Mac). Is a transfer fee due when sold to a new buyer, or does exemption sec. 77.25(2), Stats, apply to the sale?
5. Can you give some examples of other Governmental Agencies?

Husband - Wife Conveyances

1. When does the “Between husband and wife” exemption under sec. 77.28(8m), Wis. Stats., apply?

Joint Tenancy

1. In preparing a transfer tax return to accompany a deed in which the owner of a single-family residence is a single male. He has requested that we prepare a deed from him (as sole owner) to himself and his cohabitant (as joint tenants). The couple does not plan to marry. Following are my questions:

• When figuring the transfer fee, should I figure it on 1/2 the value of the real estate or should I figure it on the entire value?
• Grantor/Grantee relationship: Is it none? Or is it "Other" with the explanation of "cohabitants"?
• Type of Transfer: Should it be "Other" and explained as "Conveyance” with no explanation?
• Ownership interest transferred: Should it be "Full" or should it be "Other" and explained by "Grantor is conveying a 1/2 interest to Grantee"?
• Does Grantor retain any of the following rights: Should it be "None" (because he is giving up his rights as an individual owner and conveying them to himself and his cohabitant as joint tenants)? Or should it be "Other" and explained with "Grantor retains a 1/2 interest"?
2. In filing a quit claim deed from a surviving spouse disclaiming joint tenancy in the real estate of the decedent  under sec. 854.13(2) (b), Wis. Stats., the effect is as though the surviving joint tenant had predeceased the decedent.  Is a transfer return required? Also, would a return be required when the children of the decedent disclaimed any interest in the estate and they had no prior interest or title in the real estate?

Land Contracts

1. When a land contract was taken out, the property was all vacant land. Now the property has improvements.  What value goes on the transfer return, the original land contract value or the current property value with the improvements?
2. How will the satisfaction of land contracts that are dated prior to September 1, 1981 ($1/thousand, 1 mill) be reported on the eRETR? The eRETR automatically calculates at $3/thousand, 3 mills). Will a waiver (PE-500w) be required?
3. Does a vendee’s assignment of land contract for collateral only require a transfer return?
4. Why is another transfer fee due on an assignment of a vendee’s interest in a land contract when the fee was paid on the original land contract?
5. What is the measure of the fee when a vendee sells their interest in an original land contract for $100,000 and there is a balance owing on the land contract in the amount of $100,000?
6. A city sells property to an individual on a land contract and the transfer return (required since the transferor is the lender) was filed using Exemption (2). Later the city sells its vendor's interest in the land contract to another individual and records the assignment without a return as the vendor's interest is a personal interest in a debt. Now the deed in satisfaction is being recorded, does Exemption (17) apply since the land contract was exempt and the current vendor is not a governmental agency?
7. Is there a transfer fee due on a deferred land contract when there is an assignment of a vendor's interest in a land contract?
8. Is the recording of a deed in partial satisfaction of a land contract that releases one parcel of the two parcels conveyed on the land contract exempt from return and fee?
9. When was the deferral of transfer fees changed on land contracts?
10. When is a land contract exempt from fee?
11. Can Exemption (8) be used on a land contract between parent and child?
12. Is a deed in satisfaction of a land contract caused by will, descent or survivorship exempt from fee?
13. Is a return needed when there is an amendment of a land contract reflecting an increased interest rate or longer term where the fee was paid when the land contract was recorded?
14. Pursuant to a divorce decree, the husband is to give his vendee's interest in the land contract to his wife. Is a transfer fee due on the original land contract even if the divorce conveyance is exempt?
15. If a vendor and vendee of an original land contract sign their respective interest over to a third party, is there a fee due?
16. There are 2 vendees in a land contract and 1 vendee is assigning his interest in the property to the other vendee.  Does the vendor’s name go on the transfer return as grantor and is there a fee due?

Lease

1. Can a Register of Deeds accept a lease (assignment of lease) regarding a telephone cell tower and no explanation as to the length of the lease being assigned without a transfer return?
2. A hospital built a day care center on property it owns. Now, they are selling just the building, and the new owners are going to lease the land. Is the sale of the building going to be subject to transfer return and fee?
3. For transfer fee purposes, a fee is due for a lease of 99 years or more, pursuant to sec. 77.21(1), Wis. Stats. How would you measure the number of years for a lease with an initial term of less than 99 years but renewable so it becomes 99 years or more?
4. When recording a deed that conveys a lease of 30 years remaining on an original 99-year lease, is this conveyance subject to transfer return and fee?
5. If you file a "Termination of Lease" for a lease that is less than 99 years, do you need a transfer return?
6. If a condominium is selling its units as a 75 year lease for $100,000, is a transfer return and fee due?
7. Renter A entered into a ground lease with Owner B for 50 years. B constructed a building on this land. B then assigned this lease and sold the building to Buyer C.  Would the sale of the building on leased land be subject to the fee and return?

Legal Description

1. Is there any way to get the symbols to appear correctly into the eRETR Legal description box?

Life Estates(LLC)

1. When gifting property to your children and grandchildren while keeping a life estate, is there a formula to calculate the value of the property being conveyed?
2. If a grandmother is gifting her home to her granddaughter and reserving a life estate, is this exempt from fee per sec. 77.25(8) or (13), Wis. Stats.?
3. Is there a fee due on the purchase of a life estate?
4. Is a fee due on the repurchase of a life estate by a condominium association?

Limited Liability Company (LLC)

1. Is conveying property from my revocable trust of which I am the trustee to my limited liability company (LLC) exempt from transfer fee?
2. The successful bidder at the sheriff’s sale was an LLC. The only members of the LLC are the defendants related as husband and wife. In essence, they purchased their own house, but in the name of the LLC. The LLC was in existence prior to the commencement of the foreclosure and the sheriff’s sale. Can you tell me if this transfer is exempt pursuant to § 77.25(15s) because the Grantors are the only members of the Grantee?
3. An LLC is going to be dissolved. The LLC owns some condo units and plans to deed each member of the LLC a unit. The members are unrelated to each other, so they cannot use Exemption (15s). There is a mortgage on all the units held by the LLC and the individual members will take a loan out on their individual units in order to have the LLC's outstanding mortgage released. Is there a transfer fee due for each unit or can they use  either Exemption (5) for partition or Exemption (10) to release a security or debt?
4. Property is in a revocable living trust. The trust uses the same Social Security Number as the settlor/trustee. His children are the beneficiaries. The trustee, (father), now wants to convey the real estate to a limited liability company (LLC) whose only members are his children. Is there a fee due if we deed the real estate directly to the LLC?
5. Can another entity be a member of a LLC and be exempt from transfer fee per sec. 77.25(15s), Stats?
6. Can a general partnership convert to a limited liability company and be exempt per sec. 77.25(6m), Stats?
7. When selling a membership interest in your LLC where the LLC name will remain the same and the only change will be the members who own the LLC, do you need to file a deed and pay a transfer fee since the members are not related?
8. If a corporation transfers its real estate to its LLC and the ownership in the corporation and LLC are identical, is this exempt from fee under sec. 77.25(6m), Wis. Stats.?
9. There is a limited liability company (LLC) with two unrelated members, with the real estate titled in the LLC's name.  One member is having his interest redeemed by the LLC, and we want to record a deed from him to the LLC to avoid a possible cloud on the title. The LLC will continue as a one member LLC. Is this deed exempt from transfer return and fee?
10. Would a married couple (H & W) owning real property together which they want to convey directly INTO an LLC, whose sole member is W, be exempt from transfer fee when the real property comes OUT of that same LLC to both of them?
11. AB, LLC holds title to real estate and consists of 2 unrelated individuals, X and Y. Y sells his membership to X. AB, LLC will continue as always, but X wants to record a deed indicating AB, LLC is now a solely owned LLC. Is this transaction subject to transfer fee?
12. If the sole members of an LLC are "A" and "B”, who are unrelated and are also sole partners in a partnership, would the following relationship between "A" and "B" qualify for the exemptions (15m) and (15s)? The partnership wants to convey real property to the LLC. "A" has a sister ("C") who is married to ("D") who is the brother of "B." Since a direct conveyance from the partnership to the LLC would result in a transfer fee being imposed, regardless of the relationship of the partners and members, we are proposing a conveyance from the partnership to the individuals using (15m) and then from the individuals to the LLC using (15s). Are "A" and "B" related as required for the exemptions?
13. "A" was the brother-in-law of "B" and both of them are the sole members of A&B, LLC that owns real estate. "A" is now divorced from "B's" sister, can they liquidate the LLC and exempt the conveyance from fee per sec. 77.25(15s), Wis. Stats.?
14. What are some examples of required relationships for Exemption (15) for corporations, (15m) for partnerships and (15s) for limited liability companies?
15. Two single-member LLC’s hold title as tenants in common to 6 condos and are interested in splitting up these properties.  Is a transfer fee due on the value of each condo, or does Exemption (5), “on partition”, apply?  LLC A will convey to LLC B units 3, 4 & 9 and LLC B will convey to LLC A units 10, 11 & 12, plus $11,000 cash.
16. Can a conveyance from a corporation or partnership to an LLC whose members are the same as the shareholders in the corporation or the partners in the partnership be exempt from transfer fees?
17. Would a conveyance of real estate from an LLC with multiple members to just one member in the LLC upon liquidation be subject to transfer fees?

Merger

1. What are the filing requirements for mergers or conversions per sec. 73.14, Wis. Stats.
2. A foreign LLC is registered to do business in Wisconsin and has one piece of property in Wisconsin.  The parent of this LLC merged into another entity.  The parent is a foreign entity and is not qualified in Wisconsin.  Does an MC-500 need to be filed?

Mineral Rights

1. Has the Department changed its requirement of filing a real estate transfer return and payment of the transfer fee on mineral and timber rights?
2. How is the transfer fee calculated on a mineral lease?
3. When a lease is recorded and a transfer fee is paid for a mineral lease to extract gravel for a future road project, and the road project goes to another contractor, the lease is terminated, and all consideration paid is returned according to the lease terms, is the transfer fee that was paid with the recording of the lease eligible for a refund?

Mobile Homes

1. Is a mobile home considered to be real estate or personal property when being sold with the lot?  Is it subject to transfer fee?
2. A mobile home which is on a leased site, on a foundation and hooked to water, sewer and other utilities is sold. Is the conveyance subject to the transfer fee?

Non-Profit Organizations

1. What exemption applies for a conveyance to or from a nonprofit organization or church?
2. What does the exemption sec. 77.25(20), Wis. Stats. - "Made under 184.15" mean?

Parcels

1. There are two adjoining parcels with two tax parcel Numbers. Before a garage can be built on the vacant parcel, they need to be combined under one legal description for zoning purposes. Does a transfer return need to be filed when filing the deed combining the lots?
2. Is the property lister responsible for adding or deleting parcel numbers on an Electronic Real Estate transfer return? If the parcel numbers are wrong or incomplete, can the property lister add/delete once the property lister gets the form?

Parent Child

1. A mother sold the family home to son and daughter-in-law.  Is there a transfer fee due on this amount?
2. If parents gift their home to son and daughter-in-law, is this exemption under 77.25(8), Wis. Stats?
3. My father this giving my husband and I a home value at $121,000. We will be assuming the mortgage to pay the remaining $77,000. Are we exempt from fee and how do we complete the eRETR?
4. A father and two sons own 1/3 each on three properties.  One son is deeding his 1/3 interest in each property to his father and brother.  Mortgage is $360,000 and the real estate value is $300,000 for the properties.  What is the value subject to the transfer fee?

Partition

1. Two individuals own a piece of land that has now been split into two parcels. The individuals now own 2 parcels that they would like to transfer so each individual owns his own parcel.  Is a transfer fee due, or can an exemption be used?
2. Aunt, uncle, niece and nephew all own a single parcel together and want to partition it into four equal lots, with one lot going to each party.  Is a transfer fee due, or is there an exemption available?
3. Two single-member LLCs hold title as tenants-in-common to 6 condominium units and are interested in splitting up these properties.  Is a transfer fee due on the value of each condo unit, or does Exemption (5), on partition apply?
4. How do you complete the transfer returns when there is an uneven division of real estate among co-owners? Assume three siblings jointly own three properties: Property 1 has a fair market value of $60,000, and properties 2 and 3 have a value of $90,000 each. Sibling A is to receive property 1, sibling B is to receive property 2, and sibling C is to get property 3.

Partnerships

1. If a general partnership converts to a limited liability company, would the transaction be exempt from transfer fee per sec. 77.25(6m), Stats?
2. A parcel of land is owned by a partnership comprised of a father and son. Pursuant to a divorce judgment, the father must convey his half interest in the property to his wife. A deed is prepared that transfers the property from the partnership to the wife and son. Is the transfer from the partnership exempt from transfer fee by Exemption (8m) or (15m)?
3. What are some examples of required relationships for Exemption (15) for corporations, (15m) for partnerships and, (15s) for limited liability companies?
4. Would the transfer of real estate from a partnership to partners who are not related be subject to a transfer fee?

Penalties

1. If an amount of transfer fee due is understated or an improper exemption is taken, can the Department assess a penalty? Can the penalty be waiver?

Personal Property

1. A parcel of real estate being sold has items listed as "personal property" for the property tax exemption as defined by Chapter 70. Are these items also exempt from transfer fee?

Railroads

1. Do railroad companies need to file railroad conveyances with the Department of Financial Institutions (DFI), even if they have filed with the Register of Deeds?
2. The Register of Deeds returned the quit claim deed and transfer return indicating that pursuant to sec. 190.11, Wis. Stats. railroad conveyances must be filed with the Department of Financial Institutions (DFI). Payment of transfer fees are payable to DFI as stated in the statute. Is this true?

Receipts

1. Can two eRETR receipts be used with one deed?
2. Under what circumstance can the Register of Deeds reject an eRETR receipt?
3. A receipt has one grantor listed, while the deed has two. Is this receipt acceptable?
4. Are middle initials required on the receipt?
5. A receipt has 13 parcels showing and the deed has 19, how do I know if the return is correct?

Refunds

1. A transfer fee was paid. The return should have been exempt from fee. How do you apply for a refund?
2. If the transfer fee is paid in the wrong county, how do you get a refund so the feed can be paid in the correct county?

Security for a Debt

1. Explain the purpose of Exemption (10). It is our understanding that transactions claiming Exemption (10) do not transfer a real estate ownership interest. Is this correct and, if so, should the Real Property Lister be changing the tax bill address?

Sheriff Sales

1. Is an Electronic Real Estate Transfer Return need on Sheriff Sales?
2. When is a transfer fee due on a Sheriff's Deed?
3. When is a transfer fee not due on a Sheriffs' Deed?
4. If a mortgage has been assigned, does the assignment of the mortgage have to be recorded for sec. 77.25(14), Wis. Stats., to apply?
5. How is the transfer return completed for a Sheriff's Deed?
6. The successful bidder at  a sheriff’s sale  is an LLC. The only members of the LLC are the defendants, a husband and wife. They purchased their own house, but in the name of the LLC. The LLC was in existence prior to the commencement of the foreclosure and the sheriff’s sale. Is this transfer exempt pursuant to § 77.25(15s) because the Grantors are the only members of the Grantee?
7. Does a transfer return have to be filed when an IRS Certificate of Sale of Seized Property (Form 2435) is recorded?

Short Sales

1. How is the transfer fee calculated on a "short sale," where the amount owed on a mortgage exceeds the purchase price?

Social Security Numbers

1. What law permits the Department of Revenue to require Social Security Numbers (SSN/FEIN) to be reported on the transfer return?
2. When there is more than one grantor or grantee, do we have to list Social Security Numbers for each grantor and grantee?
3. If an individual buys property and does not have a Social Security Number, what do you report on the return?
4. If the grantor refuses to give his Social Security Number. How can we record the deed without this information?
5. If a return is filed using all 9s for the grantor's Social Security Number, does an amended return need to be filed later if the grantor's Social Security Number is obtained?
6. How is the Department of Revenue ensuring that the eRETR information, especially the Social Security Numbers and FEIN, are secure from identity theft?

Timber, Mineral, Air Rights

1. What are the requirements for filing a real estate transfer and payment of the transfer fee of timber and mineral rights?

Timeshares

1. Are timeshares subject to the Real Estate Transfer fee?
2. A timeshare week is being deeded to the owners' association in satisfaction of unpaid timeshare assessments.  The market value is $500 per week.  Are transfer fees due on this conveyance?

Transfer by Affidavit

1. I have to record a Transfer by Affidavit (PR-1831) with the Real Estate Transfer Return (PE-500) per s. 77.22(1), Stats. since the assets include real estate. What real estate value do I put on the transfer return?
2. Is a transfer return required when a Transfer by Affidavit (PR-1831) is recorded and includes real estate?

Transfer Fee Miscellaneous

1. Why is another transfer fee due on an assignment of a vendee's interest in a land contract, when the fee was paid on the original land contract?
2. What is the measure of the fee when a vendee sells his/her interest in an original land contract for $100,000 and there is a balance owing on the land contract in the amount of $100,000?
3. An unmarried couple owns a house as joint tenants and now one wants to convey her interest to the other owner. Is a transfer fee due, and if so, how is the fee computed?
4. The current owner of the real property is a profit sharing plan, which purchased the property for $70,000. The profit sharing plan agrees to sell the property to the grantee for $70,000.  The grantee wants to build a house on the property. The grantee has applied for financing for the property and the improvements in the amount of $255,050. The bank disburses the funds until the grantee gets the property (land and home) in his/her name. The financing will pay the profit sharing plan $70,000 for the land. The remaining loan proceeds will go to a builder to pay for the improvements. Should the transfer tax be figured on $70,000 or $255,050?
5. Are expenses such as back taxes and the broker's commission, which are paid by the buyer on behalf of the seller, included in the value subject to transfer fee?
6. Would a buyer's broker commission be included in the “Value Subject to Fee”?
7. My boyfriend cosigned the mortgage and was put on the title with me when I purchased my home. He now wants to remove his name from the title by conveying his interest to me. Is this exempt from fee per sec. 77.25(3) or (10), Wis. Stats.?
8. A red stop sign appears stating that the filer must enter an exemption when I am completing an eRETR to report a deed that conveys half of a property to a tenant in common. If no exemption is applicable, what entry is required to remove the stop sign for completion of the eRETR?

Transfer on Death Deed (TOD Deed)

1. Explain the filing requirements for the exemptions  pursuant to sec. 77.25(10m), Wis. Stats., “Solely to designate a TOD beneficiary under sec. 705.15,” and sec. 77.25(11m), Wis. Stats., “By non-probate transfer on death under sec. 705.15.”
2. Is a transfer return with an exemption pursuant to sec. 77.25(11m), Wis. Stats., required to be filed when: 1) the final judgment is recorded; 2) the personal representative's deed is recorded; or 3) the new TOD-110 form which pertains to non-probate transfers of real property under sec. 705.15, Wis. Stats., to a Transfer On Death (TOD) beneficiary is filed?
3. Section 705.15, Wis. Stats., allow for non-probate transfers of real property at death. A single person and/or a couple could provide for property to pass upon death to their beneficiaries without probate. Since there is no passage of ownership interest occurring when filing a document designating beneficiaries under this section, is a transfer return required?
4. When filling out a transfer return upon the death of the grantor in a Transfer On Death to a beneficiary situation, would the Grantor be the decedent and would you use the decedent’s Social Security Number?
5. A Non-Probate TOD Deed was recorded and now I want to revoke it.  A Quit Claim Deed has been drafted that states specifically the Deed is made pursuant to sec. 705.15(3), Wis. Stats., and is removing the beneficiary.  Will a Transfer Tax Return be needed and what exemption should be used?

Trustees Deed

1. A trust beneficiary receives a Trustee's Deed marked "Exemption (11)" with no transfer return. Does it qualify for the exemption under sec. 77.25(11), Wis. Stats., "By will, descent, or survivorship?"

Trusts

1. Why is a transfer return needed when creating a trust?
2. When you have a deed to or from a trust, when filling out the eRETR, do you enter the trust name or the trustee's name as the Grantor/Grantee?
3. Can the exemption under sec. 77.25(11), Wis. Stats., be used when conveying property from a trust to the beneficiaries?
4. An individual creates a trust and conveys property to it. The beneficial rights to the trust are sold by the creator of the trust. (This type of trust is commonly used in Illinois.) When the rights are sold nothing is recorded since this is similar to selling stock or an interest in a partnership and is considered the transfer of personal property. Now the trustee is to convey the real property to the beneficiaries. Is the conveyance exempt from fee pursuant to sec. 77.25(9), Wis. Stats.?
5. When transferring the ownership of your homestead to a trust, how do you retitle your deed from your name to the name of your trust?
6. Is a transfer return required when a Trustee's Deed is recorded to evidence a change of trustees?  For instance, property occupied by a disabled person and his parent is held in a trust and the trustee (bank) is changed to an individual successor trustee (individual) for the same trust.
7. A daughter is quit claiming her interest in property back to her mother who wishes to put the  property into her trust.  Can this be done with one deed/transfer return or does it requires two deeds/transfer returns?
8. Property is in a revocable living trust. The trustee (father) now wants to convey the real estate to a limited liability company (LLC) whose only members are his children. Is there a fee due if the real estate is transferred directly to the LLC?
9. Is conveying real property into a revocable living trust exempt from transfer fees, even if there is debt on the property?
10. Is an assignment of vendee’s interest in a land contract to a trust, created for the benefit of the grantor’s children, exempt from transfer fees?
11. After a grantor created a trust, he conveyed real property to it.  He then sold the beneficiaries' rights to the trust.  Is a transfer fee due?
12. A will directs that real property be conveyed to the grandchildren of the deceased.  Since the children are minors, the estate transfers the property to a trust set up for the grandchildren.  Is a fee due?

Value of Property (Subject to Transfer Fee)

1. When gifting property to your children and grandchildren while keeping a life estate, is there a formula to calculate the value of the remainder being conveyed?
2. Is there another table we can use that has a formula to calculate the value of property being conveyed that is the remainder of a life estate?
3. The Real Estate Transfer Return Instructions indicate that the “real estate value transferred” can be zero “0” for exemptions (3), (10), (13) and (17). Why is no value and zero used?
4. What is the value subject to fee on a conveyance of a vacant lot with a contract to construct a building?

Weatherization

If claiming an exclusion from the Rental Weatherization standards, refer to the list of exclusion codes within the eRETR instructions:
https://ww2.revenue.wi.gov/GenericFile/help/eRetr/detail.htm#weatherization

Further information in regards to the Weatherization Program and Exclusion Codes can be found at the Department of Safety and Professional Services website: http://dsps.wi.gov/sb/SB-RentalWeatherizationProgram.html#resources

1. Is a conveyance that is exempt from transfer fee under sec. 77.25, Wis. Stats., also exempt from the Rental Weatherization standards under sec. 101.122, Wis. Stats.?
2. If I buy a residential building to fix it up and sell, do I need to comply with the Rental Weatherization standards? The property will not be rented to anyone or occupied as a primary residence during the time of rehabilitation.
3. Are property purchases by relocation companies subject to the Rental Weatherization standards?
4. Do the Rental Weatherization standards apply to a property that will be torn down within two years of transfer?
5. Are transfers due to foreclosures subject to the Rental Weatherization standards?
6. Are transfers by probate subject to the Rental Weatherization standards?
7. Are the Rental Weatherization standards applicable to a dwelling that I plan on allowing a family member to live in without paying rent?
8. When is the W-4 exclusion, for dwellings not rented in the winter, applicable?

Will, Descent or Survivorship

1. If four siblings receive real estate and other assets in equal shares pursuant to a will, does sec. 77.25(11), Wis. Stat., “By will, descent or survivorship”, apply where an agreement between the heirs states one heir will receive the real estate and the remaining heirs receive other assets?
2. A trust beneficiary receives a Trustee's Deed marked Exemption (11) with no transfer return. Does it qualify for Exemption (11), by will descent or survivorship?

 

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Adverse Possession

1. If a court ordered judgment awards the plaintiff’s property due to adverse possession, does this need a transfer return?

   No.  Adverse possession is exempt from a transfer return and fee. An action of adverse possession or “quiet title” is referred to as a declaration of interest in real property. This legal action clarifies property interests that are claimed to already exist. Consequently, such an action does not convey property interest and hence is not a conveyance. A conveyance recorded without a return requires the document to state “This is an adverse possession action and not a conveyance under sec. 77.21(1), Wis. Stats. and is exempt from transfer return and fee imposed under sec. 77.22(1), Wis. Stats.

Agent

1. When is the agent section of the transfer return required to be completed?

   Whenever the grantor or grantee is not an individual, the agency section must be completed (Ex: Sheriff, Fiduciary). The information would be of the person signing the documents for the grantor and person accepting the documents for the grantee. For a trust, the trust name would be entered as grantor or grantee and the trustee would be the agent. When there is more than one entity grantor or grantee and they each have different agents, enter the data for the first grantor or grantee listed. If agent for grantor and grantee is different, enter the grantor’s agent on the return and list the grantee’s agent information on the Legal Description Page of the eRETR. If there are questions regarding the conveyance, we need to be able to contact directly the person familiar with the conveyance. A generic phone number or address of an entity is not sufficient.

2. Does the agency portion of the return need to be completed if the grantor is an entity such as a trust, LLC, partnership, etc?

   Yes, the person signing for the entity must complete the grantor agent portion of the return.

Agent to Principal

1. Buyer A and Buyer C intend to purchase two adjacent lots from Seller B. Because A and C do not want B to know that C is buying lot 2, A enters into a purchase agreement to buy the two adjacent lots from B and immediately transfer lot 2 to C. Can a transfer fee be avoided on the conveyance from A to C?

   If A and C have an agency agreement between them, this is an “agent to principal” transaction and could be exempt from fee per sec. 77.25(9), Wis. Stats. The use of Exemption (9) also requires the conveyance to be for "no consideration." If A transfers lot 2 immediately after taking title from B and does not benefit from having held title other than be compensated for their time for being involved with the transactions, then Exemption (9) would apply.

Affidavit of Correction

1. When recording the Affidavit of Correction in lieu of re-recording a previously recorded deed, do you need to file a transfer return?

   Since the Affidavit of Correction is intended to correct a scrivener’s error, it is not considered a conveyance of real property under sec. 77.21(1).  Thus, and a transfer return is not required.  Place the following statement on the affidavit of correction to note its exemption from the transfer return filing requirement and fee:

   “The purpose of this affidavit of correction is to [insert description of correction here] only and is therefore not a conveyance as defined by sec.77.21(1), Wis. Stats. As such, this affidavit is exempt from transfer return and fee imposed under sec. 77.22(1), Wis. Stats.”
   

   NOTE:  A transfer return is required when an Affidavit of Correction adds or deletes grantors, grantees or parcels to correct the original deed. However, the Affidavit is exempted from the real estate transfer fee pursuant to sec. 77.25(3), Wis. Stats. which applies to errors such as the inadvertent inclusion or omission of a grantor/grantee or parcel/easement. When filing the Affidavit of Correction, remember to include  the document number of the document being corrected in the eRETR.

   The following lists specific examples of errors that require a Transfer Return:

   • The failure to include all grantors and/or grantees.
   • Identifying or changing the percentage interest in the property.
   • The addition or removal of parcels.
   • Disclaiming an interest by an individual that was on title.

   The following lists specific examples that do not require a Transfer Return:

   • Misspelled names.
   • The failure to identify a complete name such as full or middle name rather than initials, Jr., Sr., II, nick names such as Jack for John, and marital and divorce name changes.
   • Typos on lot numbers or condo unit numbers.
   • The failure to identify marital status or incorrect marital status.
   • Disclaiming an interest by an individual that was not on the title.
   • Describing the ownership of the property such as joint tenancy or tenancy in common.
   • Changing a last name for deeds following a divorce.
   • A typographical error in the legal description. See above when adding or removing parcels.

Bankruptcy

1. Is a bankruptcy ordered conveyance of real estate exempt from transfer fee?

   Pursuant to Tax 15.03(10), Wis. Adm. Code, a conveyance order by the bankruptcy court is subject to transfer fee.

2. In closing a transaction under Chapter 11 of the Bankruptcy Code pursuant to 11 U.S.C. § 1146(a) how do you complete the transfer return?

   To complete the return, use exemption sec. 77.25(14), Wis. Stats., for the exemption from fee and for “Type of Transfer”, check “Other” and explain that the property is being sold pursuant to an approved plan under Chapter 11 of the Bankruptcy Code which is not subject to tax as stated in 11 U.S.C. § 1146(a).

3. In closing a transaction under Chapter 11 of the Bankruptcy Code pursuant to 11 U.S.C. § 1146(a), “the issuance, transfer, or exchange of a security, or the making or delivery of an instrument of transfer under a plan confirmed under section 1129 of this title, may not be taxed under any law imposing a stamp tax or similar tax.” Will a sale that is part of an overall plan and must be completed before the plan of reorganization is confirmed by the bankruptcy court still be exempt from transfer fee?  How do you fill out the transfer form?

   In order for the conveyance to be exempt from transfer fee under sec. 77.25(14), Wis. Stats. the conveyance must occur AFTER he transaction is exempt so long as the Bankruptcy Court approves the complete plan (see next question). Whether the conveyance occurs before or after the confirmation, the critical point is that the sale is part of the approved plan. To complete the return, use exemption sec. 77.25(14), Wis. Stats., for the exemption from fee and for “Type of Transfer”, check “Other” and explain that the property is being sold pursuant to an approved plan under Chapter 11 of the Bankruptcy Code which is not subject to tax as stated in 11 U.S.C. § 1146(a).

4. Based on States of Illinois & Washington v. National Steel Corp., No. 03 C 3932 (N. D. Ill. Sept. 9, 2003), has the Department changed its interpretation of transfers that are exempt from the transfer fee under Chapter 11 of the Bankruptcy Code?

   Conveyances pursuant to Chapter 11 of the Bankruptcy Code pursuant to 11 U.S.C. § 1146(c) are exempt from the fee only after the approval of the plan. This interpretation will be effective for open years per sec. 77.26(7), Wis. Stats.

Boyfriend/Girlfriend

1. A girlfriend and boyfriend purchased a house together.  The mortgage is in the boyfriend’s name and is more than the value of the real estate.  Title is in both names.  Girlfriend is signing over her ½ interest to the boyfriend.  Are a return and a transfer fee due?

A deed and an eRETR must be completed to convey title to real estate.  There is no exemption for this conveyance.  A transfer fee is due on ½ of the total value of the real estate conveyed.

Condos (Condominiums, Dockominiums, Garageominiums)

1. Does a condo declaration amendment that relocates the boundaries between adjoining units require a transfer return?

   A deed and an eRETR must be completed to convey title to real estate.  There is no exemption for this conveyance.  A transfer fee is due on ½ of the total value of the real estate conveyed.

2. If a condominium sells its units as “life estates” for $100,000 and at the time of sale they also sign a "Repurchase Agreement" whereby the condominium will purchase the “life estates” back for 90% of the $100,000. What transfer fees are due and at what values?

   Upon recording the life estate, a transfer fee is due on the $100,000. A life estate is a conveyance of real property interest. Additionally, the “repurchase” will be subject to fee on the amount paid to buy back the life estate when the instrument terminating the life estate is recorded. The value of the "repurchase" is determined by sec. 77.21(3)(a), Wis. Stats., as “the amount of the full actual consideration paid therefore or to be paid, including the amount of any lien or liens thereon.”

3. A condominium is selling its units as a 75 year lease for $100,000. Is a transfer return and fee due?

No. A lease less than 99 years is not a conveyance of real property per sec. 77.21(1), Wis. Stats. The document recorded should have a statement included on its face stating that “this is a lease less than 99 years and. Thus, therefore is not a conveyance as defined by sec. 77.21(1), Wis. Stats. This lease is exempt from return and fee imposed under sec. 77.22(1), Wis. Stats.” The filer, not the Register of Deeds, must exempt the document.

Confidentiality

1. What precautions are taken by the Wisconsin Department of Revenue to ensure the confidentiality of transfer returns when authorized individuals inspect them?

   Pursuant to sec. 77.265, Wis. Stats., transfer returns and the information contained in the returns can be disclosed to:

   • Local assessors, their agents or employees.
   • County property lister, treasurer and register of deeds.
   • Employees of governmental agencies acquiring real property for public purposes.
   • The Department of Workforce Development pursuant to sec. 106.50, Wis. Stats.
   • Property owners or their agents in condemnation proceedings or in appeals of their property tax assessment.
   • A county may use the returns to develop a tract index if the county does not reveal the Social Security Numbers of the buyers and sellers.

   The Department of Revenue may make available to the public all information obtained from transfer returns except social security numbers and telephone numbers:

   • If you visit a property tax district offices to view a transfer return you must provide proof of identity.  If a governmental agency is requesting to view a transfer return, the agency must present an agency authorization in the form of a letter.

   In cases of a condemnation proceeding or an appeal of an assessment:

   • If an agent, make a copy of the agreement appointing the agents.
   • If an assessment appeal, request a copy of the objection form. Call the clerk of the taxing district where the objection form has been filed.
   • Record all forms that have been photocopied on Form 709, "Request to Examine Real Estate Transfer Returns,” listing county document numbers, volume and page.
   • Persons obtaining photocopies of transfers shall write their name and date on the bottom of each copy.
   • A subpoena to view or copy a transfer must be authorized by a judge.
   • Persons requesting copies of their own returns through an agent must provide the agent with a limited power of attorney.

Conversions

1. Explain the filing requirements for mergers or conversions pursuant to sec. 73.14, Wis. Stats.?

   If an acquired business entity in a merger or the converted business entity in a conversion had a fee simple ownership interest in any Wisconsin real estate immediately prior to the merger or conversion, the surviving business must submit an MC-500 Report to the Department of Revenue no later than 60 days after the effective date of the merger or conversion. Failure to file the report within the time frame or to specify the municipalities affected will result in penalties per sec. 73.14(2)(a), Wis. Stats. It is optional to record deeds changing title to the property with the county Register of Deeds. The primary purpose of the MC-500 Report is to give notice of where future real estate tax bills are to be sent and does not convey or change title to real estate. The MC-500 Report can be found on the Department of Revenue’s web site at: https://ww2.revenue.wi.gov/internet/merger.html.

2. Delaware corporation registered to do business in Wisconsin converts to a Delaware LLC. Since Wisconsin corporate law doesn’t recognize a foreign conversion, the Delaware corporation will have to withdraw from doing business in Wisconsin and the converted entity (LLC) will have to register to do business in Wisconsin. Is the LLC required to file a MC-500 pursuant to sec. 73.14, Wis. Stats.?

   Even though you are not filing this as a "conversion" with the Wisconsin Department of Financial Institutions, it is a "conversion." The statute is makes no distinction between "domestic" or "foreign" entities. It merely states that if the non-survivor owned a fee simple interest in any Wisconsin real estate the report is required to be filed. Therefore the "survivor" is required to file the MC-500 Merger/Conversion Report.

Corporations

1. Does the exemption in sec. 77.25(7), Wis. Stats., apply to a transfer by a subsidiary corporation to its parent when its parent is a limited liability company?

   If the subsidiary corporation is conveying its real estate assets “to its parent for no consideration, nominal consideration or in sole consideration of cancellation, surrender or transfer of capital stock between parent and subsidiary corporation,” then the transfer will be exempt from fee. Since section 77.25(7) uses the words “subsidiary corporation” and “parent” without reference to the parent's entity type, the parent could be a corporation or LLC. However, pursuant to Gottfried, Inc. v. Wisconsin Department of Revenue, 145 Wis.2d 715 (Ct. App. 1988), a “parent” cannot be an individual but must be a business entity.

2. Explain the 3 year requirement for the exemption in sec. 77.25(15), Wis. Stats., for corporations.

   This requirement only applies to conveyances FROM the corporation. To qualify for the exemption in sec. 77.25(15), Wis. Stats., the corporation must have had title to the property for 3 or more years prior to the conveyance, in addition to the other stated requirements. The holding period requirement does not apply for conveyances TO the corporation.

3. If a corporation deeds its property to the corporation's president for no consideration will a transfer fee apply?

   Yes, unless one of the exceptions in sec. 77.25, Wis. Stats., can be applied.  The only exemption that could be applied to a conveyance between a corporation and an individual is sec. 77.25(15), Wis. Stats. In order for sec. 77.25(15) to apply, all three of the following requirements must be met:

   • The president is a shareholder AND all of the shareholders are related as required by the exemption;
   • The conveyance is for no consideration other than surrender of stock and/or the assumption of debt; AND
   • The corporation has owned the property 3 years or more prior to the conveyance.

Corrections (prior to eRETR being recorded by Register of Deeds)

1. The following describes the RETR correction procedure: If an error is discovered on a real estate transfer before the Register of Deeds records the transfer, the Register of Deeds will call the preparer at the number listed on the bottom of the receipt and notify him of the errors.   After being notified by the Register of Deeds, the preparer needs to:
   • Return to the eRETR website. "Restore" the saved file and make the necessary corrections.
   • Once all corrections have been made, select “Submit” and print the new receipt, which will have a different receipt number.

     Note: Each selection of the “Submit” button will create a new receipt number.  As such, please make all necessary corrections prior to hitting "Submit".  The preparer should save a copy of the corrected file.

   • Once the corrections have been resubmitted, the preparer should send or deliver the new receipt to the Register of Deeds.
   • The Register of Deeds will then enter the new receipt number. Once the Register of Deeds receives the receipt for the corrected return, the receipt for the original, incorrect return may be discarded.
   • The complete “Register of Deeds Criteria for an Electronic Real Estate Transfer Return (eRETR)” can be viewed and printed at: http://www.revenue.wi.gov/pubs/slf/pe100e.html.
     
2. How do I file an Amended Real Estate Transfer Return (PE-500x) when I do not have a document number?

   A document number is generated once a deed has been recorded.  Thus, an Amended Real Estate Transfer Return (PE-500x) is only used AFTER a deed has been recorded and an error is discovered.

   If you discover an error BEFORE you receive a document number, the error can be corrected in one of three ways:
   • If while filling out the eRETR online an error is noted on the Summary page, go back to the section containing the error and make the correction prior to hitting "Submit".
   • If you have saved your return and an error is discovered after clicking the green Submit button, return to the eRETR home page and restore the saved file. Hit "Start" and then "Restore Saved Information" (located on the right underneath the "Remaining time" counter).  Locate the file on your computer using the "Browse" function and then select "Upload File.  "Make correction and save, then click green Submit button. You will get a receipt with a new receipt number to send in with document. Toss the "old" receipt out. (Note: If the file was not saved you must complete a new eRETR.)
   • If the return was not saved, you must re-do the return.
   • If the deed has already been recorded by the Register of Deeds, you must file an Amended Real Estate Transfer Return (PE-500x) to correct the error.

   Note: If you need to re-record a deed or record an affidavit of correction you will need to file another Electronic Real Estate Transfer Return (eRETR).  You may not use an amended real estate transfer return (PE-500x) for this purpose. The PE-500x can only be used after a deed is recorded.

Corrections (after eRETR being recorded by Register of Deeds)

1. The assessor for “Big City” discovered that the eRETR for a conveyance of a parcel located in "Little Town" listed a municipality and parcel number that did not match the deed conveying property in. How does "Big City's" assessor correct this situation so the assessor of “Little Town” can view the sale?
   • The assessor for "Big City" would complete an amended real estate transfer return containing the correct municipality and parcel number and “submits” it to DOR.
   • DOR logs into eRETR and prints a copy of the receipt and incorrect return. DOR deletes the recorded Receipt/Return.
   • DOR completes new receipt using existing information from the printed return.
   • DOR logs in as the ROD and records a new receipt using the old document Number and date recorded.
   • DOR then replies to both the assessor that submitted the amended return and the assessor whose parcel it is that it is now corrected.
2. How should a transfer return be completed when a deed is recorded correcting or reforming a previously recorded deed?

   The return should be filled out the same as the original except for:

   • The item being corrected (i.e. name of grantor, grantee, legal description, etc.)
   • Under "Type of Transfer" - check "other" and explain what is being corrected/reformed.
   • List the value of the real estate to be transferred as zero (0).
   • Cite Wis. Stat. 77.25(3) to exempt the deed from the real estate transfer fee and enter the document number of the document being corrected.
3. How do you correct a transfer return after it is recorded by the Register of Deeds?

   If a mistake is discovered after the return is recorded by the Register of Deeds, you must file an amended Real Estate Transfer Return (PE-500x).

Date of Conveyance

1. What is the difference between "Date Recorded" and Date of Conveyance?

   The, "Date Recorded" is the date the Register of Deeds records the instrument of conveyance. The “Date of Conveyance” is the date the instrument is signed and delivered per sec. 706.02(1), Wis. Stats. The date recorded and date of conveyance may be the same date if both actions occur on the same day.

2. How important is it that the "Date of Conveyance" on the eRETR and the date of the deed match?

   The "Date of Conveyance"is the date the deed is "delivered to the buyer" which has been interpreted as the “date of closing” even though the deed may have been signed on a different date. If the date of closing is changed to a different month or into the next year from what was originally entered, the eRETR "Date of conveyance" must be changed.  For Example:  Tax exempt property is sold from a church to an individual. The deed is signed December 15, 2009, and closing is January 6, 2010. The date of conveyance was entered as December 15, 2009. The tax exempt property was put on tax roll for 2010. The new owner sued and won the case for another year of exemption as "date of closing" was after January 1. A claim for Lottery & Gaming Credit for primary residence is similar to above.  Since the deed is signed on December 15, 2009, and closing is scheduled for January 6, 2010, the property does not qualify as a Primary Residence as of January 1, 2011.  Therefore, the Lottery & Gaming Credit would not apply until Jan. 2012.

Deed of Trust

1. Does a "Deed of Trust" need a transfer return when it is supposed to be similar to a real estate mortgage?

   Yes, A "Deed of Trust" replaces or serves as a mortgage where legal title to real property is placed with a Trustee, and is considered a conveyance. If there is a default, the trustee would convey the property to the lender or successful bidder. This is different from a mortgage since a mortgage is not a conveyance of real property. For a default of a mortgage, a deed conveying the real property interest would have to be given by the borrower or sheriff to the lender or successful bidder. The exemption in sec. 77.25(10), Wis. Stats., applies to "Deeds of Trust" when used in place of a mortgage.

Deeds - Filing

1. How should a real estate transfer return be completed when the deed lists the person's (or entity's) current name and alternate name or names?

   Enter the person or entity's current name and at least one former or alternate name on the return.

2. Can a paper PE-500 be used to record any deed?

   No, Wis. Stat 77.22(2) requires that all real estate transfer returns be filed electronically.

Deeds - Multiple

1. Will the Department still accept “one transaction – one return” where the Register of Deeds receives multiple deeds conveying different interests in the same property to the same grantee and there is only one receipt filed?

   No. Each instrument conveying an interest in real estate will require its own eRETR receipt. A portion of the total value of the property conveyed must be allocated to each return. Example: Three (3) siblings sell their individual interests in parcel A  to X. Each sibling will file a separate deed. Each sibling must file a transfer return for their respective interest transferred to X showing one third of the real estate value and the fee calculated on that value. 

   The eRETR simplifies the completing of multiple returns that have similar information by making a “template”.

• Complete an eRETR for the first deed and before or after hitting the green "Submit” button, save the file on your computer under a name that identifies it with the deed. Do not change the ".dor" extension.
• Submit, print and attach the receipt to that deed.
• Return to the “Filer’” page and select “restore saved information” to access the saved eRETR and make changes for the second deed.
• Repeat these steps for the remaining returns.

Developers

1. Developer (land owner) and builder (improvement owner) are selling to the same party. How many deeds can be used for this conveyance?

   Either one or two deeds can be used. If only one deed is used then both the developer and the builder are listed as grantors on the deed and the Real Estate Transfer Return. If two deeds are used (one for the developer and one for the land owner) then each has their own respective transfer return. The developer's return will indicate the property type as “land only” on the Physical Description page of the transfer return. The builder's return will indicate the property type as “Other” and provide the explanation of “improvements only”.

2. What is the Department’s position as to value subject to transfer fee on a conveyance of a vacant lot with a contract to construct a building?

   The value subject to transfer fee is only the value of the real property at the time of conveyance. The improvement value would be included with the lot value only on that percentage of improvement completed at the time of conveyance. Examples:

   • If there is only a vacant lot with a construction contract – lot only.
   • Improvement is 50% completed - lot plus 50% of the value of the improvement.
   • Improvement is 100% completed - lot plus total value of the improvement.

   Note: This position is in accordance with R & R Development Group, LLC v. Wisconsin Department of Revenue, (CCH) ¶400-407 (WTAC Feb. 11, 1999).

Domestic Partners

1. What information is available for the Domestic Partner Fee Exemption – Sec. 77.25(8n), Wis. Stats.?

   The 2009 budget bill, 2009 Wisconsin Act 28, created an exemption from transfer fee for conveyances "between an individual and his or her domestic partner under chapter 770." The domestic partner exemption, under sec. 77.25(8n), Wis. Stats., was effective as of July 1, 2009. This exemption does not apply to a conveyance prior to that date. The eRETR's Fee Computation page has been updated to include the domestic partner exemption under sec. 77.25(8n), Wis. Stats. In order to qualify for the domestic partner exemption, is the grantor and grantee must obtain a declaration of domestic partnership as defined in  Chapter 770 prior to the conveyance. Please contact the Department of Health Services for any questions regarding the domestic partner declaration - http://dhs.wisconsin.gov/vitalrecords/

2. Does an employer’s extension of benefits to domestic partners qualify a conveyance between domestic partners for an exemption from transfer fee under sec. 77.25(8n), Wis. Stats.?

   No. In order for a conveyance to qualify for an exemption under sec. 77.25(8n), Wis. Stats., the individuals must comply with sec. 770.07, Wis. Stats. Specifically, a domestic partnership agreement must be recorded with the Register of Deeds in the county of primary residence prior to the date of conveyance.

3. If a domestic partnership agreement is recorded in the county of primary residence, is a separate domestic partner recording required when placing the names of both domestic partners on the deed of a property located in a different county?

   No. Sec. 770.07, Wis. Stats., requires the declaration of domestic partnership to be made to the clerk of the county where at least one of the individuals has resided for at least 30 days immediately before applying. Sec. 770.10, Wis. Stats., also requires recording the declaration with the Register of Deeds of the county in which they maintain their primary residence.  Once the declaration of domestic partnership has been properly recorded it can be applied in any county in the state.

Exchange in Property

1. A buyer bought vacant lot 1 and then decides he wants lot 2 instead. The buyer is now going to trade lot 1 back to the seller in exchange for lot 2. There will be no adjustment to the original purchase price. Can both exchange deeds be exempted under sec. 77.25(3), Wis. Stats.?

   No.  Transfer fees are due on both exchange deeds. Sec. 77.25(3) does NOT apply to a conveyance where the buyer has "changed his mind." An exchange of real property is subject to transfer fee per Tax 15.02(2), Wis. Adm. Code. There are two separate and distinct conveyances involved and the value should be separately determined for each. In the question above where the values are identical, there would be a fee on the fair market value of each lot as the values do not “offset” each other. In situations where the values differ: If “A” conveys parcel 1 to “B” worth $50,000 and “B” conveys parcel 2 to “A” worth $45,000 plus $5,000 cash, the fee for the “A” to “B” conveyance is on $50,000 and the “B” to “A” conveyance is on $45,000. Chapter Tax 15 can be found at: http://docs.legis.wisconsin.gov/code/admin_code/tax/15.pdf

2. Is a transfer fee due when trading vacant land for a four wheeler?

   Yes, a transfer fee is due.  Giving something in exchange for right to real estate is a conveyance for consideration, regardless of the form of consideration.  If the value of the four wheeler is less than the fair market value of the land, use the fair market value of the land as the amount subject to transfer fee.

3. Explain the concept of property exchanges and what to do if one exchanged property has a higher value than the other.

   Two separate and distinct conveyances are involved and the value for each property is separately determined as described per sec. Tax 15.02(2), Wis. Adm. Code.

Exempt from Filing Return

1. Under what circumstances may the Register of Deeds office accept deeds (instruments) without a transfer return?

   When a deed or other instrument is presented for recording without a transfer return, there must be some instruction on the document for the Register to form a judgment for acceptance or rejection. Examples:

• The recording of a document from an existing partnership converting to a limited liability partnership (LLP): "This is not a conveyance as defined by sec. 77.21(1), Wis. Stats., and is not subject to transfer return or fee."
• This is a confirmation deed pursuant to sec. 178.40, Wis. Stats., to give notice of an existing partnership converting to a limited liability partnership.”
• Husband and wife as "joint tenants with right of survivorship" to reclassify title as "survivorship marital property": “Same parties changing the classification of title and is not a conveyance as defined by sec. 77.21(1),Wis. Stats., and is not subject to transfer return or fee imposed under sec. 77.22(1), Wis. Stats.”
• An option or right of first refusal to purchase: “This is an option (or right of refusal to purchase) and is not a conveyance as defined by sec. 77.21(1), Wis. Stats and is not subject to transfer return or fee imposed under sec. 77.22(1), Wis. Stats."
• Memorandums, notices, etc., still require a transfer return unless non-conveyance is claimed as in the examples above. 
• Exemptions (1), (2), (2r), (4) and (11) do not require the filing of a return. [Note: Exemption (2) requires a transfer return if the transferor is also a lender for a transaction using Exemption (2).]

Note: It is the responsibility of the parties to exempt the transaction from transfer return and fee, not the Registers of Deeds. The Register of Deeds office should never accept such claim of exemption verbally.

2. Is a conveyance of a cemetery lot subject to a transfer return and fee?

   No. A conveyance of a cemetery lot is exempt from the transfer fee return and fee per Tax 15.05(6), Wis. Adm. Code. A conveyance of land for use as a cemetery is subject to a transfer return and fee per the same code. The document should have language to the effect of “This is a cemetery lot exempt from return and fee per Tax 15.05(6), Wis. Adm. Code” in keeping with the procedures of the Register of Deeds accepting documents without returns.

3. Is a return needed for a name change if you are recently divorced and now want to have your prior name shown on the deed?

   No. A name change is not a conveyance as defined by sec. 77.21(1), Wis. Stats., and no return is needed. Exempt the document by stating “this is a name change only and not a conveyance as defined by sec. 77.21(1), Wis. Stats. and is exempt from return and fee imposed under sec. 77.22(1), Wis. Stats.”  It is suggested that the document also show the grantor using the method of "former name f/k/a new name" granting to the new name (i.e.: grantor, Mary Smith f/k/a Mary Jones and the grantee, Mary Jones).

4. There are two adjoining parcels with two tax parcel numbers. Before a garage can be built on the vacant parcel, the parcels need to be combined under one legal description for zoning purposes. Does a transfer return need to be completed when the deed is filed combining the lots?

   No.  This is not a conveyance as defined by sec. 77.21(1), Wis. Stats., since you already own the parcels and are not conveying any real estate interest. The document should have a statement such as "This instrument is intended to combine the legal description and is not a conveyance as defined by sec. 77.21(1), Wis. Stats. and is exempt from return and fee imposed under sec. 77.22(1), Wis. Stats.”  By filing a transfer return, you will be assured that the tax lister and local assessor will be informed of the combined parcels.

5. If there is no statement on the document exempting the recording from a return, and the grantee’s agent is insisting the document is exempt from the fee and return, can the Register of Deeds record the document?

   No. A prerequisite to recording is the filing of a complete return or the filing of a document with the statutory reference exempting it entered on its face. This reference is to the exemption under sec. 77.25 Wis. Stats. The relevant language must be stated on the instrument of conveyance. See sec. 77.22(1), Wis. Stats.

   If the document is to be exempted from the return and fee requirement of sec. 77.25(1), (2), (2r), (4) or (11), there must be a statement on the face of the document exempting it.  An example of such language is: "This document is exempt from return and fee per sec. 77.25(#), Wis. Stats."  (The # sign represents the applicable exemption.)

   If the document is a lease (less than 99 years) or other non-conveyance of a real property interest, a statement explaining the reason for no return should be on the document.  An example of such language is: "This document is a lease of less than 99 years and not a conveyance as defined by sec. 77.21(1), Wis. Stats and is exempt from return and fee imposed sec. 77.21(1), Wis. Stats."

   The grantor and grantee have the responsibility of properly claiming the exemption (from filing the transfer fee return) on the conveying document.

6. My neighbor and I had a new survey done and we need to record a deed that corrects the lot line between us. How do I complete the transfer return for a lot line correction?

   Since the lot line correction is not a real estate conveyance, a transfer return is not required. Add a description on the deed to the effect that "This is a lot line correction to the above legal description and not a conveyance of real property per sec. 77.21(1), Stats."

Farmland

1. Can “Farmland Use Value” be used for Total Value of Real Estate when agricultural property is being conveyed?

   No. Use value assessment is a method of of assessing agricultural land for Chapter 70, Wis. Stats., and is not used for value on the transfer return per definitions under sec. 77.21, Wis. Stats. Value for transfer fee purposes is defined in sec. 77.21(3)(a), Wis. Stats., which provides:

   "Value" means:
   (a) In the case of any conveyance not a gift, the amount of the full actual consideration paid therefor or to be paid, including the amount of any lien or liens thereon; and
   (b) In case of a gift, or any deed of nominal consideration or any exchange of properties, the estimated price the property would bring in an open market and under the then prevailing market conditions in a sale between a willing seller and a willing buyer, both conversant with the property and at prevailing general price levels.

Federal Revenue Stamp

1. If a deed has the Federal Revenue Stamps on it, how do you calculate the price paid for the property from these stamps?

   Prior to 1969, the United States government had a revenue stamp that was at the rate of $0.55 on each $500.00, or fractional part thereof, of the sale price or value of the property conveyed. Values of less than $100.00 were exempt from the stamp.

Fees

1. If the Department of Revenue responsible for paying fees to the Register of Deeds when requesting copies of documents?

   No. According to sec. 59.43(2) (b), Wis. Stats., the Department of Revenue is exempt from the fee.

Financing

1. I am selling my house and am giving back a “second mortgage” which may or may not be forgiven. How is the transfer form filled out for “Grantees Financing”?

   More than one box must be checked. Check the box “Obtained from seller” and any additional box as to where the primary financing is obtained. In addition to a second mortgage, any type of financial arrangement from the seller such as “credit”, “gift”, “donation” etc. must have the box “Obtained from seller” checked in addition to any other box showing where the balance of the financing is obtained.

Foreclosures

1. Four people (2 couples) purchased real estate, with all 4 named as grantees on the deed.  One couple furnished the purchase price and made an agreement with the other couple to contribute.  The non-paying couple cannot pay and will quit claim to the paying couple.  Is this transaction exempt from fee as a deed in lieu of foreclosure?

   Yes. The Wisconsin State Statutes, (sec. 706.05, Wis. Stats.), states these types of documents (mortgage, agreement), are “entitled” to be recorded.  Wisconsin law does not require the mortgage to be recorded to be valid.  However, it is in the best interest of the lender to record the mortgage or agreement to protect their lien interest in the real estate.

Gifts

1. Is a gift of real estate to a university or college foundation that funds research and scholarships exempt from a transfer return and transfer fee under sec. 77.25(2g), Wis. Stats.?

   No, a foundation is not an instrument, agency, or subdivision of the United States or the state.

2. If I give my nephew a house, is a transfer return and fee due?

   Yes, Even though the house was a gift, a fee is due on the full market value of the property per sec. 77.21(3)(b), Wis. Stats. Transactions between and uncle and niece or nephew are not exempt.

General Partnership

1. Is a quit claim deed from a general partnership for a conversion to the limited liability partnership subject to a transfer fee?

   No. A general partnership registering as a limited liability partnership, is exempt under sec. 77.25(6d), Wis. Stats. “Pursuant to partnerships registering as limited liability partnerships under sec. 178.40, Wis. Stats.”  Exemption (6d) is only for conversion of a general partnership to a limited liability partnership.

2. Is a quit claim deed from a general partnership to a limited liability company subject to a transfer fee?

   Yes. A conversion from a general partnership to a limited liability corporation is not permitted under sec. 178, Wis. Stats. It is a conveyance between two entities and is subject to transfer fee.

   Sec. 77.25(6m), Wis. Stats., is specific to conversions of a limited partnership under sec. 179.76, Wis. Stats.; domestic corporation under sections 180.1161 and 181.1161, Wis. Stats., and limited liability companies under sec. 183.1207, Wis. Stats., to another form of entity permitted.  Exemption (6m) only applies if, after the permitted conversion, the ownership interests in the new entity are identical with ownership interests in the original entity immediately preceding the conversion.

Government Agencies

1. Are all sales to a governmental agency exempt from fee under sec. 77.25(12), Wis. Stats, pursuant to or in lieu of condemnation?

   No. Not all sales to a governmental agency are exempt from fee. The conveyance is exempt per Exemption (12) as “pursuant to or in lieu of condemnation” if the sale meets the criteria under sec. 32.05, or sec. 32.06 Wis. Stats.  At a minimum the procedures under Chapter 32 for condemnation need to be initiated.

   The exemption does not apply when:

   • The property purchased has been on the open market for sale.
   • The property was the final selection of many parcels for a project that could have been placed anywhere. For example: a maintenance garage would not be exempt because it could be placed anywhere, as opposed to an extension of an airport runway which must be placed at the end of a runway.
2. Is the following satisfaction of a land contract exempt per sec. 77.25(17), Stats? A city sells property to an individual on land contract and the transfer return (required since the transferor is the lender) was filed using Exemption (2). Later the city sells its vendor's interest in the land contract to another individual and records the assignment without a return as the vendor's interest is a personal interest in a debt. Now the deed in satisfaction is being recorded. Does Exemption (17) apply since the land contract was exempt and the current vendor is not a governmental agency?

   Yes. Since the original vendor was a governmental agency and exemption sec. 77.25(2), Wis. Stats., was properly used, the satisfaction is exempt per sec. 77.25(17), Wis. Stats., regardless of the current vendor.

3. When gifting property to a public school district, is this conveyance exempt from fee?

   Yes. A gift to a public school district is exempt from the fee per sec. 77.25(2g), Wis. Stats.  Note that a gift to a private school is subject to fee per Tax 15.03(5) Wis. Adm. Code which relates to: “conveyances between an individual and a tax exempt organization.

4. My company has just started handling the resale of properties foreclosed by Federal Home Loan Mortgage Corporation (Freddie Mac). My question is whether or not a transfer fee will be due when they sell to a new buyer, or does exemption sec. 77.25(2), Stats, apply to the sale?

   Freddie Mac is exempt from transfer fee per sec. 77.25(2), Stats. as an instrumentality of the United States based upon Rust v. Johnson, 597 F.2d 174 (9th Cir. 1979). Federal Home Loan Mortgage Corporation (Freddie Mac) and Federal National Mortgage Association (Fannie Mae) are exempt from transfer fee.  See, sec. 77.25(2) ("From the United States or from this state or from any instrumentality, agency or subdivision of either.")  The exemption from real estate transfer fee is not by their charter under 12 USCS § 1732a(c) since they are subject to state and local real estate taxes.

5. Can you give some examples of other Governmental Agencies?
   • Department of Housing and Urban Development, 42 USCS § 3532
   • Federal Intermediate Credit Bank, 12 USCS § 2071
   • Federal Land Bank, 12 USCS § 2011
   • Federal Land Bank Association, 12 USCS § 2031
   • Production Credit Association, 12 USCS § 2091
   • Veterans Administration, 38 USCS § 201
   • Federal Home Mortgage Corporation
   • Federal National Mortgage Association
   • Farmers Home Administration
   • Farmers Home Loan Mortgage Corporation
   • Farm Credit Banks Federal Housing Authority
   • Government National Mortgage Association (Ginny Mae)
   • Resolution Trust Corporation, 12 USCA § 1441
   • Federal Deposit Insurance Corporation

Husband - Wife Conveyances

1. When does the “Between husband and wife” exemption under sec. 77.28(8m), Wis. Stats., apply?

EXEMPT FROM FEE:

• Conveyances between a husband and wife while married whether a sale, land contract, gift, etc., are exempt from transfer fee.
• Conveyances that are pursuant to divorce where one party is to receive the property are exempt from transfer fee.

Note: A transfer return is required when the only document to be recorded is the divorce judgment. If the judgment is splitting various properties to each ex-spouse it is considered two conveyances and requires two judgments and two receipts to be recorded.

SUBJECT TO FEE:

• Conveyances where ex-spouses both hold joint title until the property is sold to a 3rd party and then one elects to take sole ownership either by gift or sale are subject to transfer fee because the conveyance is not pursuant to the divorce decree. A transfer fee is due on one half of the property’s fair market value.
• Conveyances to or from an entity where that spouse does not have an interest in the entity are subject to transfer fee.  A transfer fee is due on the property’s full fair market value.

Joint Tenancy

1. In preparing a transfer tax return to accompany a deed in which the owner of a single-family residence is a single male. He has requested that we prepare a deed from him (as sole owner) to himself and his cohabitant (as joint tenants). The couple does not plan to marry. Following are my questions:

• When figuring the transfer fee, should I figure it on 1/2 the value of the real estate or should I figure it on the entire value? Transfer fee is due on one half of the fair market value since one half of the value is being conveyed.
• Grantor/Grantee relationship: Is it none? Or is it "Other" with the explanation of "cohabitants"? Either one applies or both may be checked. “Other” must have an explanation.
• Type of Transfer: Should it be "Other" and explained as "Conveyance” with no explanation? "Other" can be checked and explained as “cohabitants.”
• Ownership interest transferred: Should it be "Full" or should it be "Other" and explained by "Grantor is conveying a 1/2 interest to Grantee"?"Other" and explained by "Grantor is conveying a 1/2 interest to Grantee".
• Does Grantor retain any of the following rights: Should it be "None" (because he is giving up his rights as an individual owner and conveying them to himself and his cohabitant as joint tenants)? Or should it be "Other" and explained with "Grantor retains a 1/2 interest"? "Other" and explained with "Grantor retains a 1/2 interest".

2. In filing a quit claim deed from a surviving spouse disclaiming joint tenancy in the real estate of the decedent  under sec. 854.13(2) (b), Wis. Stats., the effect is as though the surviving joint tenant had predeceased the decedent.  Is a transfer return required? Also, would a return be required when the children of the decedent disclaimed any interest in the estate and they had no prior interest or title in the real estate?

   The spousal deed would be exempt from return and fee per sec. 77.25(11), Wis. Stats., as being “By will, descent or survivorship.”  It is assumed that spouses may also have an interest in the property under marital property law. For the children, since they had no prior interest or title in the property, this would be exempt from return and fee pursuant to sec.77.21 (1), Wis. Stats. You should state on the document something to the effect “this is a disclaimer only and not a conveyance as defined by sec. 77.21(1), Wis. Stats, and therefore is exempt from return and fee imposed under sec. 77.22(1), Wis. Stats. ” If they had an interest in the property, then the use of the exemption per sec. 77.25(11), Wis. Stats., would apply. We have instructed the Register of Deeds that they should not accept exempt recordings verbally and the person recording the document should place the exemption on the document when no return is furnished.

Land Contracts

1. When a land contract was taken out, the property was all vacant land. Now the property has improvements.  What value goes on the transfer return, the original land contract value or the current property value with the improvements?

   The value that needs to be on the return is the original land contract value. The real estate was conveyed on the land contract, not the satisfaction.

2. How will the satisfaction of land contracts that are dated prior to September 1, 1981 ($1/thousand, 1 mill) be reported on the eRETR? The eRETR automatically calculates at $3/thousand, 3 mills). Will a waiver (PE-500w) be required?

   The eRETR allows for the .001 mil rate land contract so no waiver will be needed. The following describes how to complete the eRETR.

   On the "Transfer" page of the eRETR:

   • Select "Deed in satisfaction of land contract" and also "Other." Explain in the "Other" field that the land contract is dated mm/dd/yyyy and requires a one mill payment.

   On the "Fee Computation" page of the eRETR:

   The total value of real estate transferred = value of original land contract

   The value subject to fee = 1/3 the value of the original land contract. The fee will calculate to the amount based upon the rate of .001.

   Since the “Value subject to fee” is less than the “Total value of real estate transferred,” select transfer fee Exemption (17) - Sat. Land Contract.”

   Provide the document number and date of the original land contact in the appropriate boxes for claiming Exemption (17).

3. Does a vendee’s assignment of land contract for collateral only require a transfer return?

   Generally, no.  As long as the assignment clearly states that it is for “collateral” only, then no transfer return would be required.  Note that a “bare assignment” of a vendee’s interest, where the type of assignment under paragraph A or B (State Bar of Wisconsin Form 15-2003) are either both crossed out or both are checked requires a return and fee. It will be implied that the assignee has assumed this debt rather than accepting the assignment for collateral only.

4. Why is another transfer fee due on an assignment of a vendee’s interest in a land contract when the fee was paid on the original land contract?

   These transactions are two separate and distinct conveyances. First there is a fee on the original land contract (or any instrument evidencing the existence of a land contract) and secondly the sale and obligation of payment on the assignment of a vendee’s interest in a land contract is subject to transfer fee per sec. 77.21(1), Wis. Stats., and Tax 15.04, Wis. Adm. Code.

5. What is the measure of the fee when a vendee sells their interest in an original land contract for $100,000 and there is a balance owing on the land contract in the amount of $100,000?

   The fee is based upon $200,000 as the amount of the full actual consideration paid there for or to be paid, including the amount of any lien or liens thereon per sec. 77.21(3), Wis. Stats.

6. A city sells property to an individual on a land contract and the transfer return (required since the transferor is the lender) was filed using Exemption (2). Later the city sells its vendor's interest in the land contract to another individual and records the assignment without a return as the vendor's interest is a personal interest in a debt. Now the deed in satisfaction is being recorded, does Exemption (17) apply since the land contract was exempt and the current vendor is not a governmental agency?

   Yes. Since the original vendor was a governmental agency and exemption sec. 77.25(2), Wis. Stats., was properly used, the satisfaction is exempt per sec. 77.25(17), Wis. Stats., regardless of the current vendor.

7. Is there a transfer fee due on a deferred land contract when there is an assignment of a vendor's interest in a land contract?

   No. An assignment of a vendor's interest does not provide for the passage of ownership interest in real property and does not require a transfer return under sec. 77.21(1), Wis. Stats. Since a return is not required for a conveyance of a vendor’s interest and typically does not involve the vendee, the deferred original land contract can remain deferred until satisfied or upon an assignment of the vendee's interest in the land contract. Note: An assignment of a vendee's interest is not only subject to fee but also requires a transfer fee on the original deferred land contract; this is because equitable conversion gives the vendee an ownership interest in the real estate.

8. Is the recording of a deed in partial satisfaction of a land contract that releases one parcel of the two parcels conveyed on the land contract exempt from return and fee?

   A transfer return is required, but the exemption under sec. 77.25(17), Wis. Stats., would apply. Exemption 17 would apply to a deed executed in fulfillment of a land contract if the proper fee was paid when the land contract or instrument evidencing the land contract was recorded. On the “Fee Computation” page, you should enter the value of the portion satisfied in the box “Total value of real estate transferred.” Do not enter the total of the original land contract.  See, sec. Tax 15.04(5), Wis. Adm. Code. Example: A 40-acre parcel was sold under an original land contract for $80,000. A deed was issued in partial satisfaction of this land contract covering 5 acres. The fee is based upon 5/40 of $80,000 or $10,000. Enter zero (0) in the box “Value subject to fee.” You may then select Exemption (17) and enter the document number of the recorded land contract. Note: If the land contract was recorded prior to August 1, 1992 and the fee was deferred, then a transfer fee would be due and you should enter the same value as shown in the box “Total value subject to fee”.

9. When was the deferral of transfer fees changed on land contracts?

   Budget Bill 991 Wisconsin Act 269, repealed the deferral of transfer fees on land contracts per sec. 77.22(2), Wis. Stats.  Effective August 1, 1992, for ALL original land contracts submitted, a transfer fee is imposed at the time the land contract is submitted for recording.

10. When is a land contract exempt from fee?
    • When recording a deed in satisfaction when the fee has been previously paid either on an amendment or on the original land contract.  Exemption (17) is used.
    • A deed from the vendee back to the vendor under foreclosure or in lieu of foreclosure, exempt per Exemption (14).
    • Exemption (1) is used when recording a deed in satisfaction of a land contract dated prior to December 17, 1971.
11. Can Exemption (8) be used on a land contract between parent and child?

    No. Exemption (8) requires the conveyance to be for no or nominal consideration. A transfer fee would be due on the full sale price of a land contract.

12. Is a deed in satisfaction of a land contract caused by will, descent or survivorship exempt from fee?

    No.  Exemption (11) may not be used since the original land contract conveyed the real property and the deed in satisfaction is only conveying a personal interest in the debt or obligation per the Doctrine of Equitable Conversion. A deed in satisfaction of a land contract must meet the requirements of exemption (17) or a transfer fee is due if the original land contract was fee deferred.

13. Is a return needed when there is an amendment of a land contract reflecting an increased interest rate or longer term where the fee was paid when the land contract was recorded?

    No.  However, the amendment should include the recording data of the original land contract for verification that a fee was paid.  NOTE:  If the value changes, a transfer return is required.

14. Pursuant to a divorce decree, the husband is to give his vendee's interest in the land contract to his wife. Is a transfer fee due on the original land contract even if the divorce conveyance is exempt?

    No.  Any conveyance between husband and wife pursuant to divorce is exempt under sec. 77.25 (8m) Wis. Stats.

15. If a vendor and vendee of an original land contract sign their respective interest over to a third party, is there a fee due?

    The effect of this conveyance merges all interests of the land contract with the third party. A fee is due on this sale. Also, if a transfer fee was deferred on the original land contract (contract consummated prior to August 1, 1992), that fee is also due.

16. There are 2 vendees in a land contract and 1 vendee is assigning his interest in the property to the other vendee.  Does the vendor’s name go on the transfer return as grantor and is there a fee due?

    An assignment of a vendee's interest in a land contract is subject to both transfer fee and transfer return because it is a conveyance of an interest in real property per sec. 77.21(1), Wis. Stats. The transfer fee is due on the value of the original purchase price of the land contract if it was a recent purchase; otherwise, fee is due on the fair market value of the real estate.  Vendors are not listed on the transfer return when doing an assignment of the vendee’s interest. The grantor is the vendee conveying their interest. The grantee is the new vendee.

Lease

1. Can a Register of Deeds accept a lease (assignment of lease) regarding a telephone cell tower and no explanation as to the length of the lease being assigned without a transfer return?

   Depends on the type of lease if a return is needed or not:

   • Farmer Brown gives a 50 year lease to Big Phone Co.: No return is required since the lease is for less than 99 years. If the wording on the recorded lease states "lease less than 99 years”, no return or fee is due per ss. 77.21(1), Wis. Stats. If the lease is for 99 years or more, then a return and fee are due. Big Phone Co. now builds a tower on leased land.
   • Big Phone Co. assigns ground lease to Little Phone Co.: Transfer return and transfer fee are required since the assignment conveys "improvements" on leased land as defined per sec. 77.21(1m), Wis.  Stats. The remaining length of the ground lease term does not matter. If the original lease was for less than 99 years then a transfer fee is due only on the tower; and if the original lease is equal to or greater than 99 years, then the fee is due on the ground lease and tower.
   • Little Phone Co. now leases tower space to Tell All Phone Co. for an antenna. This is not a conveyance of real property. No return is needed. Provided, however, that wording is included on the document submitted for recording to clarify that this is a "lease of tower space only, not a conveyance per sec. 77.21(1), Wis. Stats.
2. A hospital built a day care center on property it owns. Now, they are selling just the building, and the new owners are going to lease the land. Is the sale of the building going to be subject to transfer return and fee?

   Yes.  The sale of the building will require a transfer return and fee. The building on leased land is defined as real estate per sec. 77.21(1m), Wis. Stats.  “Real estate includes, but is not limited to, fixtures; roots, vines and trees of perennial crops; stock in a cooperative building; improvements on leased land; timber; and minerals.”

   Note: If the lease is for 99 years or more, the lease will also be subject to a transfer return and fee. “Leases for at least 99 years but excluding leases for less than 99 years” are defined as a conveyance of real estate per sec. 77.21(1), Wis. Stats.

3. For transfer fee purposes, a fee is due for a lease of 99 years or more, pursuant to sec. 77.21(1), Wis. Stats. How would you measure the number of years for a lease with an initial term of less than 99 years but renewable so it becomes 99 years or more?

   Leases less than 99 years are not conveyances of real property per sec. 77.21(1), Wis. Stats. If the original lease is 50 years, that lease expires and they decide to renew for another 50 years this would be considered to be less than 99 years and be exempt from transfer return and the transfer fee. Language on the recorded document such as the following must be stated that "This is a lease less than 99 years and not a conveyance per sec. 77.21(1), Wis. Stats."

   However, if the original lease is for 50 years with an option to renew for years totaling 99 years or more, it would be a lease for 99 years and subject to return and transfer fee. This situation is similar to a land contract, which is subject to fee.

4. When recording a deed that conveys a lease of 30 years remaining on an original 99-year lease, is this conveyance subject to transfer return and fee?

   Yes. A lease for at least 99 years and a conveyance of any remaining portion thereof is defined as a passage of ownership interest in real property per sec. 77.21(1), Wis. Stats., and requires a transfer return and fee. A transfer fee would be due per sec. 77.21(3), Wis. Stats., unless expressly exempted under sec. 77.25, Wis. Stats.

5. If you file a "Termination of Lease" for a lease that is less than 99 years, do you need a transfer return?

   No. The termination of a lease does not convey an interest in real estate. If the document does not clearly state that this is a termination of a lease, you must include the statement such as, "This is a termination of a lease less than 99 years and not a conveyance per sec. 77.21(1), Wis. Stats."

6. If a condominium is selling its units as a 75 year lease for $100,000, is a transfer return and fee due?

   No. A lease less than 99 years is not a conveyance of real property per sec. 77.21(1), Wis. Stats. The document recorded should have a statement included on its face such as: "This is a lease less than 99 years and is not subject to return per sec. 77.21(1), Wis. Stats.” The filer, not the Register of Deeds must exempt the document.

7. Renter A entered into a ground lease with Owner B for 50 years. B constructed a building on this land. B then assigned this lease and sold the building to Buyer C.  Would the sale of the building on leased land be subject to the fee and return?

   Yes. The definition of real estate specifically includes improvements on leased lands

Legal Descriptions

1. Is there any way to get the symbols to appear correctly into the eRETR Legal description box?

   The Microsoft symbols (from Microsoft Word) that you can insert into a document will NOT carryover properly in the eRETR legal description. Symbols should be typed using "Alt-Key Codes". Symbols can be created by holding the Alt key while typing “34” or “39” on the number key pad and a ' or a " will appear. To type the 'degree' symbol for legal descriptions, press and hold the Alt key while typing “0176” on the number keypad and a ° will appear. These “Alt-Key Codes” should work with any software application.

Life Estates

1. When gifting property to your children and grandchildren while keeping a life estate, is there a formula to calculate the value of the property being conveyed?

   The value that needs to be on the return is the fair market value of the property actually being transferred. This is calculated by taking the fair market value of the property and multiplying it by a factor as determined in the table is the Wisconsin Department of Health and Family Services Medicaid Eligibility Handbook found at, http://www.emhandbooks.wi.gov/meh-ebd/.  The value gifted to the children would be exempt from the transfer fee per sec. 77.25(8), Wis. Stats., while the value gifted to the grandchildren would be subject to the transfer fee. On the eRETR “Fee computation” page, enter the total value in “Total value of real estate transferred” as calculated using the tables referred to above, and in the “Value subject to fee” enter the calculated value to the grandchildren.  Select “(8)” in the exemption selection box.

2. If a grandmother is gifting her home to her granddaughter and reserving a life estate, is this exempt from fee per sec. 77.25(8) or (13), Wis. Stats.?

   No. Exemption (8) is between parent and child, not grandparent and grandchild. A transfer fee is due on the fair market value of the property less the value of the life estate. Unless the actual value of the real estate conveyed is less than $100.00, Exemption (13) does not apply.

3. Is there a fee due on the purchase of a life estate?

   Yes. The initial sale of the life estate is subject to a transfer fee based upon the sales price.

4. Is a fee due on the repurchase of a life estate by a condominium association?

   Yes. The fee is based upon the consideration paid or to be paid on the date of the repurchase.  The fee is paid at the time the instrument is recorded terminating the life estate.

Limited Liability Company (LLC)

1. Is conveying property from my revocable trust of which I am the trustee to my limited liability company (LLC) exempt from transfer fee?

   The conveyance would be exempt from fee under sec. 77.25(15s), Wis. Stats., provided the conveyance was from the trustee and that the trustee was a member of the LLC as an individual representing himself/herself and not a member as the trustee indicating the trust was a member. Another entity, including a trust, cannot be a member of an LLC under the exemption as it requires only humans can be members. The use of exemptions under sections 77.25(15), (15m) and (15s), Wis. Stats., require the entity ownership to be owned by humans.

2. The successful bidder at the sheriff’s sale was an LLC. The only members of the LLC are the defendants related as husband and wife. In essence, they purchased their own house, but in the name of the LLC. The LLC was in existence prior to the commencement of the foreclosure and the sheriff’s sale. Can you tell me if this transfer is exempt pursuant to § 77.25(15s) because the Grantors are the only members of the Grantee? The conveyance is not exempt per sec. 77.25(15s), Wis. Stats., since the exemption requires the conveyance to be for no consideration. A purchase at a Sheriff sale does not meet that requirement. Nor does sec. 77.25(14), Wis. Stats., apply since the LLC would be considered a “third party.” since the LLC was not the mortgage holder. However, it would be exempt under the “2 step” method if the individuals were to be the successful bidders and take title using Exemption (14) and then convey into their LLC using (15s).
3. An LLC is going to be dissolved. The LLC owns some condo units and plans to deed each member of the LLC a unit. The members are unrelated to each other, so they cannot use Exemption (15s). There is a mortgage on all the units held by the LLC and the individual members will take a loan out on their individual units in order to have the LLC's outstanding mortgage released. Is there a transfer fee due for each unit or can they use  either Exemption (5) for partition or Exemption (10) to release a security or debt?

   No transfer fee exemption applies to these conveyances. A transfer fee is due on each of the deeds to the members based upon the fair market value of each unit. Exemption (5) does not apply as the definition of partition is not met. Partition is defined under sec. 77.21(1k), Wis. Stats., as “the division among several persons of real property, including noncontiguous real property, that belongs to them as co-owners.” The facts do not fit within the definition of partition since the individuals do not own the real estate; the LLC owns the real property. The individuals own the membership in the LLC which is personal property. Exemption (10) does not apply since there is a conveyance of real estate and not “solely to provide or release Security for a debt.” Exemption (10) only applies when a deed is used or serves as a mortgage or lien.

4. Property is in a revocable living trust. The trust uses the same Social Security Number as the settlor/trustee. His children are the beneficiaries. The trustee, (father), now wants to convey the real estate to a limited liability company (LLC) whose only members are his children. Is there a fee due if we deed the real estate directly to the LLC?

   Yes, a fee is due since the only members of the LLC are the children, not the father/trustee. Exemption 77.25(15s), Wis. Stats., requires that the grantor (the trustee in this case) be a member along with the other family members. The primary beneficiaries, his children  are still living, so the LLC is not the beneficiary under sec. 77.25(9), Wis. Stats. This conveyance could be exempt if the following steps were taken:

   • Convey from the trust to the father who is the beneficiary under sec. 77.25(9), Wis. Stats.
   • Father conveys by gift to children under exemption sec. 77.25(8), Wis. Stats.
   • Children convey to LLC.

   To be exempt, the multi step procedure must be taken as determined in other court decisions such as Turner, d/b/a Epco, Limited Partnership of Wisconsin, v. Wisconsin Department of Revenue, 2004 WI App 82, Appeal No. 03-1517. The Wisconsin Tax Appeals Commission decision may be accessed at, http://www.wisbar.org/res/txap/2002/01t102.htm.

5. Can another entity be a member of a LLC and be exempt from transfer fee per sec. 77.25(15s), Stats?

   No. Transfer fees are due on conveyances to or from entities when another entity is the member, partner or shareholder of that entity. The use of exemptions (15), (15m), and (15s) requires the entity ownership to be humans. This was decided by F.M. Management Company Limited Partnership and F.M. Real Estate Company, LLC, v. Wisconsin Department of Revenue, 2007 WI App 125, Appeal No. 03-153s. This decision can be found at: http://www.wisbar.org/res/capp/2003/03-1356.htm.

6. Can a general partnership convert to a limited liability company and be exempt per sec. 77.25(6m), Stats?No. The exemption applies only to a conveyance pursuant to the conversion of a business entity to another form of business entity under sec. 179.76, 180.1161, 181.1161, or 183.1207.
   • Sec. 179.76(1), Wis. Stats. A domestic limited partnership may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic limited partnership is converting.
   • Sec. 180.1161(1)(a), Wis. Stats. A domestic corporation may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting.
   • Sec. 181.1161(1)(a), Wis. Stats. A domestic corporation may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting.
   • Sec.183.1207(1)(a), Wis. Stats. A domestic limited liability company may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic limited liability company is converting.

   A general partnership can only convert to a limited liability partnership under sec. 77.25(6d), Wis. Stats., with provides, “Pursuant to partnerships registering as limited liability partnerships under sec. 178.40, Wis. Stats.” and cannot be combined with sec. 77.25(6m), Wis. Stats.

7. When selling a membership interest in your LLC where the LLC name will remain the same and the only change will be the members who own the LLC, do you need to file a deed and pay a transfer fee since the members are not related?

   A change in the membership interest only is considered personal property and not subject to a transfer return if a deed is recorded showing the members of the LLC. This is similar to selling of stock in a corporation in that there is not a conveyance of real property and a deed does not need to be recorded. Example:

   XYZ, LLC is owned by 1, 2 and 3 and title to the property is in the name of XYZ, LLC. The members sell their membership interest to 4, 5 and 6. XYZ, LLC still has title to the property and a deed does not have to be recorded since the real property was not conveyed. Whether or not you file a deed to show who the members are is a business decision the members will have to decide upon.  If a deed or other document is recorded, language on the document stating something to the effect that "This is being recorded to indicate the current members of XYZ, LLC and is not a conveyance of real property per sec. 77.21(1), Wis. Stats."

8. If a corporation transfers its real estate to its LLC and the ownership in the corporation and LLC are identical, is this exempt from fee under sec. 77.25(6m), Wis. Stats.?

   No. A transfer fee is due on conveyance between separate entities having the same identical ownership. The exemption is for a "conversion" in which, for instance, the only change is the form of the same entity from a corporation to an LLC. The "conversion" exemption is "pursuant to the conversion of a business entity to another form of business entity under sec. 179.76, 180.1161, 181.1161, or 183.1207, if, after the conversion, the ownership interests in the new entity are identical with the ownership interests in the original entity immediately preceding the conversion." Also, the use of any of the three (15), (15m), or (15s) exemptions under sec. 77.25, Wis. Stats., would not apply since this is a conveyance between entities and not between individuals who are related as family members. Refer to the Turner, d/b/a Epco, Limited Partnership of Wisconsin, v. Wisconsin Department of Revenue, 2004 WI App 82, Appeal No. 03-1517, for additional information. The Wisconsin Tax Appeals Commission decision may be accessed at, http://www.wisbar.org/res/txap/2002/01t102.htm.

9. There is a limited liability company (LLC) with two unrelated members, with the real estate titled in the LLC's name.  One member is having his interest redeemed by the LLC, and we want to record a deed from him to the LLC to avoid a possible cloud on the title. The LLC will continue as a one member LLC. Is this deed exempt from transfer return and fee?

   Yes. There is no interest in real property conveyed, only the membership interest in the LLC, which is personal property. The deed should list the grantor as the LLC's name and as each member's name. The grantee should be shown as the LLC and the remaining member. To exempt the recording from a transfer return, a description should be added to the deed explaining "this is a conveyance of a membership interest only and not a conveyance of real property and no return or fee are due per sec. 77.21(1), Wis. Stats." If you prefer to use a transfer return, Exemption (3) may be used on the “Fee Computation” page.   The document number of the deed by which the LLC took title of the real estate originally will also need to be listed on the “Fee Computation” page.

10. Would a married couple (H & W) owning real property together which they want to convey directly INTO an LLC, whose sole member is W, be exempt from transfer fee when the real property comes OUT of that same LLC to both of them?

    No, there is a fee on one half of the value. Since H is not a member of the LLC, he does not meet the relationship requirement and the conveyance is treated the same as from any unrelated entity. However, the LLC could convey to W and be exempt per sec. 77.25(15s), Wis. Stats. Then W could convey one half interest to H and be exempt per sec. 77.25(8m), Wis. Stats.

11. AB, LLC holds title to real estate and consists of 2 unrelated individuals, X and Y. Y sells his membership to X. AB, LLC will continue as always, but X wants to record a deed indicating AB, LLC is now a solely owned LLC. Is this transaction subject to transfer fee?

    No. The selling of membership in a LLC is personal property and nothing needs to be recorded since there is not a real property conveyance. When a deed is recorded ONLY indicating a change in membership interest (AB, LLC; consisting of X and Y, as grantor quit claims to AB, LLC; consisting of X, as grantee), this is exempt from the transfer return and the fee. To exempt the recording from a transfer return, a description should be added to the deed explaining "this is a conveyance of a membership interest only and not a conveyance of real property and no return or fee are due per sec. 77.21(1), Wis. Stats." This section defines conveyances. If you prefer to use a transfer return, Exemption (3) may be used on the “Fee Computation” page.   The document number of the deed by which the LLC took title of the real estate originally will also need to be listed on the “Fee Computation” page.

12. If the sole members of an LLC are "A" and "B”, who are unrelated and  are also sole partners in a partnership, would the following relationship between "A" and "B" qualify for the exemptions (15m) and (15s)? The partnership wants to convey real property to the LLC. "A" has a sister ("C") who is married to ("D") who is the brother of "B." Since a direct conveyance from the partnership to the LLC would result in a transfer fee being imposed, regardless of the relationship of the partners and members, we are proposing a conveyance from the partnership to the individuals using (15m) and then from the individuals to the LLC using (15s). Are "A" and "B" related as required for the exemptions?

    As to the relationship of "A" and "B", they would not qualify under the exemptions. Since "C's" husband "D" is the brother of "B", "A" and "B" are not considered in-laws per § 77.25 (15s) A brother-in-law is the brother of one's spouse. Therefore, while "A" and "D" would be in-laws, "A" and "B" would not.

13. "A" was the brother-in-law of "B" and both of them are the sole members of A&B, LLC that owns real estate. "A" is now divorced from "B's" sister, can they liquidate the LLC and exempt the conveyance from fee per sec. 77.25(15s), Wis. Stats.?

    No. The divorce terminated the relationship as in-laws; therefore, Exemption (15s) does not apply and a transfer fee is imposed on the fair market value of the property.

14. What are some examples of required relationships for Exemption (15) for corporations, (15m) for partnerships and (15s) for limited liability companies?

    All Exemption (15) series require relationships to each other as spouses, lineal ascendants, lineal descendants, siblings or spouses of siblings. Examples would be as follows:

    • Sole: Sole individual (Corporation or LLC only)
    • Spouses: Husband and wife
    • Lineal: Parent(s) and child(ren), parent(s) and son-in-law/daughter-in-law, grandparent(s), parent(s) and grandchild(ren)
    • Siblings: Brother(s) and sister(s)
    • Spouses of Siblings: Brother(s) and sister(s)-in-law/brother(s) and brother(s)-in-law sister(s) and sister(s)-in-law/sister(s) and brother(s)-in-law brother(s)-in-law and sister(s)-in-law or brother(s)-in-law

    Any combination of the above relationships would qualify.
    The conveyance can be to or from the entity.

    Note:

    • Conveyances from a corporation have an additional requirement of having to have been owned by the corporation for three or more years.
    • Uncles, aunts, nieces and nephews do not meet the above relationship requirements.
15. Two single-member LLC’s hold title as tenants in common to 6 condos and are interested in splitting up these properties.  Is a transfer fee due on the value of each condo, or does Exemption (5), “on partition”, apply?  LLC A will convey to LLC B units 3, 4 & 9 and LLC B will convey to LLC A units 10, 11 & 12, plus $11,000 cash.

    The co-owners can be individuals, entities or a combination of either. Here the two entities (LLCs) are going to divide the 6 condo units between them. Exemption (5) for partition applies up to the point where the partition is equal, thus the cash boot of $11,000 is subject to transfer fee.  The party receiving the cash boot is the party that owes the transfer fee because they are giving up more than they are receiving.  They would use Exemption (5) and there would be a fee due on the cash boot of $11,000.

16. Can a conveyance from a corporation or partnership to an LLC whose members are the same as the shareholders in the corporation or the partners in the partnership be exempt from transfer fees?

    No. A fee is due on the full value of the real property.

17. Would a conveyance of real estate from an LLC with multiple members to just one member in the LLC upon liquidation be subject to transfer fees?

    Yes, if the members are not related as required by exemption (15s). The transfer fee would be due on the full value of the real property.

Merger

1. What are the the filing requirements for mergers or conversions per sec. 73.14, Wis. Stats.

   If an acquired business entity in a merger or the converted business entity in a conversion had a fee simple ownership interest in any Wisconsin real estate immediately prior to the merger or conversion, the surviving business must submit the MC-500 Report to the Department of Revenue no later than 60 days after the effective date of the merger or conversion. Failure to file the report within the time frame or to specify each of the municipalities affected will result in penalties per sec. 73.14(2) (a), Wis. Stats. It is optional to record deeds changing title to the property with the county Register of Deeds. The MC-500 Report’s primary purpose is to give notice of where future real estate tax bills are to be sent and does not convey or change title to real estate. The MC-500 Report can be found on the Department of Revenue’s web site at,  https://ww2.revenue.wi.gov/internet/merger.html.

   Note: Sec. 73.14(2)(a), Wis. Stats., provides a penalty of $200 for each day that the report is late, not to exceed $7,500.

2. A foreign LLC is registered to do business in Wisconsin and has one piece of property in Wisconsin. The parent of this LLC merged into another entity. The parent is a foreign entity and is not qualified in Wisconsin. Does an MC-500 need to be filed?

   No. The ownership of the real estate has not changed as a result of the parent's transaction. The subsidiary LLC still owns the real estate.

Mineral Rights

1. Has the Department changed its requirement of filing a real estate transfer return and payment of the transfer fee on mineral and timber rights?

   No, our position is the same. Whenever there is a conveyance of mineral or timber rights, an electronic real estate transfer return is required since it is a conveyance of real estate per sec. 77.21(1m), Wis. Stats., and a transfer fee is required unless specifically exempt from fee under sec. 77.25, Wis. Stats.

   Note: Any type of document, lease, assignment of lease, deed or any other instrument that conveys a mineral or timber interest is subject to transfer return and transfer fee.

2. How is the transfer fee calculated on a mineral lease?
   The transfer fee is calculated on the amount of the full actual consideration paid therefor, or to be paid, per sec. 77.21(3) (a), Wis. Stats. Below are some examples of a gravel lease for calculating the fee at the time the lease is signed:
   • Single Payment: When the lease is paid by a single payment based upon an estimate of what is to be extracted with no future payments or royalties, a transfer return and transfer fee are due based upon the single payment amount. If the amount of what is extracted exceeds the value originally reported then you must file an "Amended Real Estate Transfer Return" to report the additional consideration and pay the additional transfer fee due.
   • Royalty/Installment: When the amount of gravel to be extracted is unknown, and only a down payment is made with future royalties or other types of future payments to be made based upon extraction, the fee is initially imposed on the down payment when the document is recorded. When additional payments are made then you must file an "Amended Real Estate Transfer Return" to report the additional consideration paid for each payment.
   • No payment/consideration: When there is no down payment or other consideration paid when the lease is recorded and only royalties or other type payments are to be made based upon extraction, the use of exemption sec. 77.25(13), Wis. Stats., as a conveyance of real estate having a "value of $100.00 or less" may be used on the transfer return. When additional payments are made then you must file an "Amended Real Estate Transfer Return" to report the consideration paid for each payment.

3. When a lease is recorded and a transfer fee is paid for a mineral lease to extract gravel for a future road project, and the road project goes to another contractor, the lease is terminated, and all consideration paid is returned according to the lease terms. Is the transfer fee that was paid with the recording of the lease eligible for a refund?

   Yes, since the lease was terminated without any gravel being taken and no consideration was given, Exemption (13) can be used. Complete an "Amended Real Estate Transfer Return”: https://ww2.revenue.wi.gov/internet/pe-500x.html. Since the transfer fee is assessed against the grantor per sec. 77.22, Wis. Stats., refunds are issued to the grantor unless specifically requested otherwise.

   Note: All claims for refund must be made within 4 years of the date the mineral lease was recorded per sec. 77.26(3), Wis. Stats.

Mobile Homes

1. Is a mobile home considered to be real estate or personal property when being sold with the lot?

   The mobile home is classified as real estate and subject to fee when the mobile home is on land owned by the homeowner, on a foundation (includes blocks) and hooked to utilities. It would be considered personal property if any of the above three requirements were not met.

2. A mobile home which is on a leased site, on a foundation and hooked to water, sewer and other utilities is sold. Is the conveyance subject to the transfer fee?

   Yes. Real estate is defined per sec. 77.21(1m), Wis. Stats., as including improvements on leased land. Even though a mobile home is defined per sec. 70.043(1), Wis. Stats., as an improvement to real property if connected to utilities and set upon a foundation upon land owned by the mobile home owner, for transfer fee purposes, it is real estate.

   Note: A transfer fee is not due if the title to the mobile home is filled out and submitted to the Department of Transportation.

Non-Profit Organizations

1. What exemption applies for a conveyance to or from a nonprofit organization or church?

   There is no exemption for conveyances to or from a nonprofit organization or church per Tax 15.03(5), Wis. Adm. Code. The fee would be based upon the fair market value of the property if the conveyance is a gift or deed of nominal consideration. If the conveyance is a sale, the sales price should be used.

2. What does the exemption sec. 77.25(20), Wis. Stats. - "Made under 184.15" mean?

   1997 Wisconsin Act 140 adopted the Uniform Unincorporated Nonprofit Association Act. The Act defines a nonprofit association as an unincorporated organization consisting of 3 or more "members" joined by mutual consent for a common, nonprofit purpose and permits the nonprofit association, in its own name, to acquire, hold, encumber or transfer real or personal property. Prior to this section, property was held by a fiduciary for the nonprofit association. The Exemption (20) allows the fiduciary to convey the vested estate or interest to the nonprofit association in its own name per "184.15 Transfers by a Fiduciary" without incurring a transfer fee.

Parcels

1. There are two adjoining parcels with two tax parcel numbers. Before a garage can be built on the vacant parcel, they need to be combined under one legal description for zoning purposes. Does a transfer return need to be filed when filing the deed combining the lots?

   No. This is not a conveyance per sec. 77.21(1), Wis. Stats. since you already own the parcels and are not conveying any real estate interest. The document should have a statement to the effect that “this instrument is intended to combine the legal description and is not a conveyance per sec. 77.21(1), Wis. Stats.” By filing a transfer return, you will be assured that the tax lister and local assessor will be informed of the combined parcels.

2. Is the property lister responsible for adding or deleting parcel numbers on an Electronic Real Estate Transfer Return? If the parcel numbers are wrong or incomplete, can the property lister add/delete once the property lister gets the form?

   No. All grantors, grantees and parcels (with exception noted below) MUST be on the Receipt. Leaving off any of those is grounds for rejection of the recording by the Register of Deeds.

   The criteria for an Electronic Real Estate Transfer Return (eRETR) state:

   All parcels listed on the document are on the Receipt. When there are five or fewer parcels, each must be listed in a separate parcel section (Add Parcel). When there are more than five, the first five must be listed separately under "Parcels" and the remainder may be listed separately here or listed under the "Short legal description". If your county does not require parcel numbers on the document (they are required on the return), you can verify the property using the legal description.

   eRETR criteria:  http://www.revenue.wi.gov/pubs/slf/pe100e.html

   It is correct that parcel numbers can be edited by the property lister for accuracy. However, it is very important that the receipt "mirrors" the document for grantors, grantees and parcels. We cannot expect the property lister or the Department of Revenue to complete the transfer return by adding parcels when it is the responsibility of the filer to have a complete return. The eRETR business rules insure all required items are completed. The only thing the eRETR cannot do is check that all grantors, grantees and parcels are included.

Parent Child

1. A mother sold the family home to son and daughter-in-law.  Is there a transfer fee due on this amount? 

   Yes.  Exemption (8) not only requires that the conveyance be between a parent and child, it also requires that the transfer be for no consideration. Because this is a sale and there is consideration, a transfer fee is due.

2. If parents gift their home to son and daughter-in-law, is this exempt under sec. 77.25(8), Wis. Stats.?

   Yes. Exemption 77.25(8) states: “Between parent and child, stepparent and stepchild, parent and son-in-law or parent and daughter-in-law for nominal or no consideration."

   Note: If there is any kind of mortgage attached to the property at the time of the conveyance, then there is consideration and a transfer fee is due on the debt.

3. My father is giving my husband and I a home valued at $121,000. We will be assuming the mortgage to pay the remaining $77,000. Are we exempt from fee and how do we complete the eRETR?

   The exemption under sec. 77.25(8), Wis. Stats., requires the conveyance to be between parent and child and for no consideration. Since financing and assumption of the remaining mortgage is involved, the requirement of "no consideration" is not met. Accordingly, the transfer fee is imposed on the $77,000.00, and Exemption (8) would apply to the equity of $44,000.00 as a gift.

   Complete the eRETR as follows:

   • Transfer type: Check “Sale” and “Gift”
   • Financing: check “Assumed existing financing”
   • Total value of real estate transferred: $121,000, Value subject to fee: $77,000
   • Select Exemption (8)
4. A father and two sons own 1/3 each on three properties.  One son is deeding his 1/3 interest in each property to his father and brother.  Mortgage is $360,000 and the real estate value is $300,000 for the properties.  What is the value subject to the transfer fee?

   There is no exemption for a conveyance between brothers, so fair market value ($360,000) is used in determining ½ of the transfer fee.  Since the mortgage is consideration, the conveyances between the parent and child is subject to fee on the debt (mortgage $300,000). The equity conveyed by parent to child is covered by Exemption 8.  The value subject to fee in this case would be on $120,000.  Calculated as follows; ½ of 1/3 of the fair market value for the brother to brother conveyance plus ½ of 1/3 of the mortgage balance for the father to son conveyance.

Partition

1. Two individuals own a piece of land that has now been split into two parcels. The individuals now own 2 parcels that they would like to transfer so each individual owns his own parcel.  Is a transfer fee due, or can an exemption be used?

   If the value of each parcel is equal, then each of the two deeds being filed will meet the requirements of the exemption in sec. 77.25(5) Wis. Stats., for deeds of partition.  The value of each parcel to be conveyed should be indicated on the transfer return as ½ of the total value of the lot, since each party is conveying his/her ½ interest in the property to the other.  In such case, no transfer fee is due.

   Example: Each lot is valued at $50,000.  On each transfer return, report $25,000 as the value of real estate conveyed.  Report $0 value as being subject to transfer fee, and claim Exemption (5).

2. Aunt, uncle, niece and nephew all own a single parcel together and want to partition it into four equal lots, with one lot going to each party.  Is a transfer fee due, or is there an exemption available?

   If the value of each parcel is equal, then these deeds being filed meet the requirements of Exemption (5) for a deed(s) of partition. The value conveyed for each transfer return is ¾ of the total value of the other 3 lots they are conveying their ¼ interest in to the one receiving the lot.

   Example: Assume the same facts as in the question above.  The original parcel is worth $120,000 and each resulting lot is valued at $30,000.  For each transfer return you would report $22,500 as the value of real estate conveyed (3 conveying owners x 1/4 interest, each worth $7,500). Report $0 value subject to transfer fee, and claim Exemption (5).

3. Two single-member LLCs hold title as tenants-in-common to 6 condominium units and are interested in splitting up these properties.  Is a transfer fee due on the value of each condo unit, or does Exemption (5), on partition apply?

   No transfer fee will be due if the total values of the interests each LLC receives are the same.  Transfer fees will be due if the values are unequal.

   Example: “LLC A will convey to LLC B units 3, 4 & 9, LLC B will convey to LLC A units 10, 11 and 12 plus $11,000 cash

   The exemption in sec. 77.25(5) for partition applies whether the co-owners are individuals, entities or a combination of either.  Here the two owners are going to divide the 6 condo units between them.  The exemption in sec. 77.25(5) Wis. Stats. for partition applies to the degree that  the partition is equal, but the cash boot of $11,000 is subject to transfer fee.  The party receiving the cash boot, LLC A, is the party that owes the transfer fee because they are giving up more value of real estate than they are receiving, and they would thus be considered the grantor of the difference in value.  The return for LLC A would use Exemption (5) as to the portion that qualifies as a partition, and a fee will be due on the cash boot of $11,000.

4. How do you complete the transfer returns when there is an uneven division of real estate among co-owners? Assume three siblings jointly own three properties: Property 1 has a fair market value of $60,000, and properties 2 and 3 have a value of $90,000 each. Sibling A is to receive property 1, sibling B is to receive property 2, and sibling C is to get property 3.

   On three transfer returns, the values of the properties should be allocated as follows: 

Property 1 to Sibling A:

Name	Value Prior	Value After	Value Change
Grantor Sibling B	$20,000	$ 0.00	($20,000)
Grantor: Sibling C	$20,000	$ 0.00	($20,000)
Grantee: Sibling A	$20,000	$60,000	$40,000
Total FMV	$60,000	$60,000	$0

Property 2 to Sibling B:

Name	Value Prior	Value After	Value Change
Grantor Sibling A	$30,000	$ 0.00	($30,000)
Grantor: Sibling C	$30,000	$ 0.00	($30,000)
Grantee: Sibling B	$30,000	$90,000	$60,000
Total FMV	$90,000	$90,000	$0

Property 3 to Sibling C:

Name	Value Prior	Value After	Value Change
Grantor Sibling A	$30,000	$ 0.00	($30,000)
Grantor: Sibling B	$30,000	$ 0.00	($30,000)
Grantee: Sibling C	$30,000	$60,000	$60,000
Total FMV	$90,000	$60,000	$0

Summary

Name	Value Prior	Value After	Value Change
Sibling A	$80,000	$ 0.00	($20,000)
Sibling B	$80,000	$ 0.00	$10,000
Sibling C	$80,000	$60,000	$10,000
Total FMV	$240,000	$60,000	$0

In In a true partition, there is no gain or loss of value of ownership interest; the property is divided equally in value among the owners. In this example, sibling A has conveyed an interest in value of $20,000. The fee due on the value of $20,000 would be allocated on the transfer returns for the deeds to Properties 2 and 3, where sibling A is the grantor. Siblings B and C have gained an interest over all; therefore, they have not “conveyed” a value in the real property and would not be subject to transfer fee per sec. 77.25(5), Wis. Stats.

Complete the transfer returns as follows:

Completing the return for the deed of property 1 from B and C to Sibling A:

• Type of Transfer: Check box “Other” and explain “partition”.
• Total value of Real Estate transferred: $40,000
• Transfer Fee: $0.00
• Exemption: (5)

Completing the return for the deed of property 2 from A and C to Sibling B:

• Type of Transfer: Check box “Other” and explain “partition”.
• Total value of Real Estate transferred: $60,000
• Transfer Fee: $30.00 (payable by A for $10,000, being one-half the $20,000 value differential)
• Exemption: (5) applies to B and C as they have no gain or loss in value

Completing the return for the deed of property 3 from A and B to Sibling C:

• Type of Transfer: Check box “Other” and provide the explanation “partition”.
• Total Value of Real Estate transferred: $60,000
• Transfer Fee: $30.00 (payable by A for $10,000, being one-half the $20,000 value differential)
• Exemption: (5) (applies to B and C as they have no gain or loss in value)

Note: The property value is determined by the fair market value of each of the properties per sec.77.21 (3), Wis. Stats. Do not adjust the fair market value by the amount of any liens on the property.

Partnerships

1. If a general partnership converts to a limited liability company, would the transaction and be exempt from transfer fee per sec. 77.25(6m), Stats?

   No. The exemption for conversions of general partnerships only applies to conversion to a limited liability partnership under sec. 77.25(6d), Wis. Stats., which is limited to “partnerships registering as limited liability partnerships under sec. 178.40.” General partnerships converting to any other kind of entity do not qualify for the exemption under sec. 77.25(6m), Wis. Stats.

   Exemption (6m) applies only to a conveyance pursuant to the conversion of a business entity to another form of business entity under secs. 179.76, 180.1161, 181.1161, or 183.1207, Wis. Stats:.

   • Sec. 179.76(1), Wis. Stats. A domestic limited partnership may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic limited partnership is converting.
   • Sec. 180.1161(1)(a), Wis. Stats. A domestic (business) corporation may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting.
   • Sec. 181.1161(1)(a), Wis. Stats. A domestic (non-stock) corporation may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic corporation is converting.
   • Sec. 183.1207(1)(a), Wis. Stats. A domestic limited liability company may convert to another form of business entity if it satisfies the requirements under this section and if the conversion is permitted under the applicable law of the jurisdiction that governs the organization of the business entity into which the domestic limited liability company is converting.

   None of these conversion provisions applies to general partnership converting to another form of ownership.

   In all cases, the exemption in sec. 77.25(6m), Wis. Stats. will only apply if, after the conversion, the ownership interests in the new entity are identical with the ownership interests in the original entity immediately preceding the conversion.

2. A parcel of land is owned by a partnership comprised of a father and son. Pursuant to a divorce judgment, the father must convey his half interest in the property to his wife. A deed is prepared that transfers the property from the partnership to the wife and son. Is the transfer from the partnership exempt from transfer fee by Exemption (8m) or (15m)?

   No. The conveyance from the partnership would not be exempt by either exemption and would be subject to a fee. The father and son own a partnership interest and not the real property and the wife is not a partner. Exemption (8m) is for conveyances of real property between spouses, while Exemption (15m) is between a partnership and its partners. The transaction may be exempt from fee by using two deeds where the partnership first conveys the property to the father and son using Exemption (15m) and the next conveyance from the father, his one half interest to the wife using Exemption (8m).

3. What are some examples of required relationships for Exemption (15) for corporations, (15m) for partnerships and, (15s) for limited liability companies?

   All exemptions under sec. 77.25(15), (15m) and (15s), Wis. Stats. require that the transfer be between the entity and one or more owners “who are related to each other as spouses, lineal ascendants, lineal descendants, siblings or spouses of siblings”. Examples that would qualify for the exemption include as the following:

   • Sole ownership: Sole individual
   • Spouses: Husband and wife
   • Lineal: Parent(s) and child(ren), parent(s) and son-in-law/daughter-in-law, grandparent(s), and grandchild(ren), parents and adopted children, but not foster parents and foster children.
   • Siblings: Brother(s) and sister(s)
   • Spouses of Siblings: Brother(s) and sister(s)-in-law/Brother(s) and Brother(s)-in-law Sister(s) and Sister(s)-in-law/Sister(s) and Brother(s)-in-law Brother(s)-in-law and Sister(s)-in-law or Brother(s)-in-law
   • Any combination of the above relationships would qualify.
   • Uncles, aunts, nieces and nephews do not meet the relationship requirements.

   The exemptions apply whether or not the conveyance is to or from the entity.

   The transfer must in all cases be for no consideration other than the assumption of debt or the acquisition in an interest in the corporation, partnership or limited liability company.

   Note:

   Conveyances from a corporation have an additional requirement that the property must have been owned by the corporation for three or more years.  If the property has been owned by the corporation for only 18 months, then the transfer from the corporation to the shareholders would not qualify for the exemption under sec. 77.25(15), Wis. Stats.

4. Would the transfer of real estate from a partnership to partners who are not related be subject to a transfer fee?

   Yes. The only possible exemption for a conveyance between a partnership and the partners is the exemption contained in sec. 77.25(15m), Wis. Stats. Since the partners are not related as required by the exemption, a transfer fee is due on the total fair market value of the real estate conveyed.

   Exemption (15m) applies to  transactions “Between a partnership and one or more partners if all of the partners are related to each other as spouses, lineal ascendants, lineal descendants, or spouses of siblings and if the transfer is for no consideration other than the assumption of debt or an interest in the partnership."

Penalties

1. If an amount of transfer fee due is understated or an improper exemption is taken, can the Department assess a penalty? Can the penalty be waived?

   A penalty is imposed under sec. 77.26(8), Wis. Stats. “If the Department of Revenue determines that the value reported on the return under sec. 77.22 is understated by 25% or more, or that an exemption was improperly claimed under sec. 77.25, the department shall assess and collect a penalty of $25 or 25% of the additional fee due, whichever is greater, in the manner that additional transfer fees are collected.”

   The imposition of the penalty was upheld in the April 15, 1996 decision of Heritage Place Limited Partnership vs. Wisconsin Department of Revenue, Waukesha County Circuit Court, Case No. 95-CV-2292.

   The penalty cannot be waived. The Department does not have discretion under sec.77.26 (8) Wis. Stats, to waive the penalty if there is an improper claim for an exemption. The statute uses the word "shall," and in statutory interpretation the use of the word "shall" generally creates a mandatory duty.

Personal Property

1. A parcel of real estate being sold has items listed as “personal property” for the property tax exemption as defined by Chapter 70. Are these items also exempt from transfer fee?

   Not necessarily. If an item of personal property is a fixture, it will not be exempt from the transfer fee, regardless of the property tax treatment. Fixtures for transfer fee purposes are defined as real property per sec. 77.21(1m), Wis. Stats., and are included in the total value of the real estate transferred. The value of such items would be shown on the eRETR Fee Computation section, in the box “Value of Property Exempt from Local Property Tax INCLUDED on Total Value of REAL ESTATE Transferred.”

   To determine if an item is a fixture one must answer the following general questions:

   • Is the article physically attached to the premises?
   • Generally, if the item is so attached that it cannot be removed without causing substantial damage to the remaining realty, it is usually considered a fixture.
   • Is there any special “adaptation” between the article and the premises?
   • If the fixture or the realty is built “specially” to accommodate the other, it is usually considered a fixture. The item in question has less value if removed and taken somewhere else.
   • Is the item something that is normally intended to be made a permanent part of the premises? 
   • The test is what the average person normally intends for the item, not what the owner intended.

Railroads

1. Do railroad companies need to file railroad conveyances with the Department of Financial Institutions (DFI), even if they have filed with the Register of Deeds?

   Yes. According to sec. 190.11, Wis. Stats., "Every conveyance or lease, deed of trust, mortgage or satisfaction... shall be filed with the department of financial institutions…"  If a railroad wants to record a railroad conveyance at both the county and with DFI, a transfer return will be required by each; however, only one transfer fee will be required. If the document is first recorded with the county and the fee paid, then when the document conveying the same property is recorded at DFI, the transfer return is exempt from fee per sec. 77.25(3), Wis. Stats., as confirming a prior recorded document.

2. The Register of Deeds returned the quit claim deed and transfer return indicating that pursuant to sec. 190.11, Wis. Stats. railroad conveyances must be filed with the Department of Financial Institutions (DFI). Payment of transfer fees are payable to DFI as stated in the statute. Is this true?

   Partially. Railroad conveyances must be recorded at DFI, but they may also be recorded at the county register of deeds.  . . It makes no difference whether filing is done first with DFI or the county.  Two returns must be completed, the first to be filed being accompanied with the transfer fee and the second claiming Exemption (3) which "confirms ... a conveyance previously recorded."  For example, if you choose to record at the county Register of Deeds first, complete the return showing the fee due and pay the transfer fee to the Register of Deeds.  After recording, the deed will be sent back to the person indicated on the deed. Then when filing the deed with DFI, a new return must be completed claiming exemption sec. 77.25(3), Wis. Stats., and no fee will be due at that time.  When using Exemption (3), you will need to provide the county's document number on the return for the conveyance with DFI.

Receipts

1. Can two eRETR Receipts be used with one deed?

   No. For one deed, only one transfer return can be accepted.

2. Under what circumstances can the Register of Deeds reject an eRETR receipt?

   The Register of Deeds is bound by sec. 77.22(1), Wis. Stats., which requires a real estate transfer return that is properly completed, with fee (if due), in order to accept the conveyance for recording. Registers need to verify that the receipt and the document being recorded are in agreement and reflect the proper county.
   Registers should make sure that all items required for a recording are present.  These include the document to be recorded, the eRETR receipt, payment of the transfer fee (if due), and any rental weatherization papers (if needed). The receipt contains a list of the required items for reference.
   Transfer fee amount: If a fee is due, it must be the same as the amount on the check or other method of payment. Note: For some transfers, there may be both a fee and an exemption, if the transfer is partially exempt.
   Date of conveyance: The date listed on the conveyance must be ON or BEFORE the date of recording.  Postdated conveyances should not be accepted.
   Grantors and grantees: All grantors and grantees that are listed on the document must be listed on the receipt. An exception is a husband and wife with the same last name, as to whom the return may have both first names in the first name box, and only one Social Security Number is required. 
   Parcels: All parcels that are listed on the document are listed on the receipt. When there are five or fewer parcels, each must be listed in a separate parcel section (Add Parcel). When there are more than five, the first five must be listed separately under "Parcels"; and the remainder may be listed separately here or listed under the "Short legal description." Parcel numbers are required on the return.  If a county does not require parcel numbers on the document, verification of the property is accomplished by using the legal description.

   The receipt must be rejected if any information on the receipt has been changed in any way.  Changing information on the receipt creates an inconsistency with the information on the eRETR.

   Criteria for an Electronic Real Estate Transfer Return (eRETR) are listed here: http://www.revenue.wi.gov/pubs/slf/pe100e.html

3. A receipt has one grantor listed, while the deed has two. Is this receipt acceptable?

   No.  All grantors and grantees named on the document must be on the receipt.

   Exception: Husband and wife with the same last name may have both first names in the first name box. Only one Social Security Number is required

4. Are middle initials required on the receipt?

   Middle initials are not a required entry field and do not have to be on the receipt. However, if they are listed on the deed, they need to be listed on the receipt.

5. A receipt has 13 parcels showing and the deed has 19, how do I know if the return is correct?
   The receipt is designed to print one page only. If there are large numbers of grantors, grantees or parcels (these sections have the "add" button), not all parcels may show on the eRETR receipt.  If the conveyance includes more than 5 parcels, the preparer must enter at least 5 parcels on the Parcel section and enter the remainder in the Legal Description box. If the correct parcels are listed, enter the recording information.  If the parcel listing is not correct, contact the preparer for a new receipt that has all 19 parcels included.

Refunds

1. A transfer fee was paid.  The return should have been exempt from fee.  How do you apply for a refund?

   Complete a PE-500X "Amended Real Estate Transfer Return”
   You will need to print and mail the amended eRETR along with:

   • A copy of the recorded deed.
   • Information supporting the exemption claimed on the amended transfer return.
   • Name or names the refund should be made out to.

   Example: you recorded a deed and paid transfer tax on the full value of the property.  You now claim Exemption (8) as a gift between parent and child.  You would need to submit a copy of the deed, evidence of the parent-child relationship, and a copy of Form 709, United States Gift Tax Return to show that the conveyance was a gift without consideration.

2. If a transfer fee is paid in the wrong county, how do you get a refund so the fee can be paid in the correct county?

   A full refund of the transfer fee paid will be issued by the county where the deed was incorrectly recorded. This improperly paid transfer fee to this county is not remitted to the state by the county treasurer since there is no transfer return recorded for this incorrect county. Note: The recording fees paid to the incorrect county are not refundable.

Security for a Debt

1. Explain the purpose of Exemption (10)? It is our understanding that transactions claiming Exemption (10) do not transfer a real estate ownership interest. Is this correct and, if so, should the Real Property Lister be changing the tax bill address?

   Exemption (10) applies to a conveyance that is made "in order to provide or release security for a debt or obligation."  Typically, these documents are in the forms of a mortgage and satisfaction of mortgage, or deeds in satisfaction of a land contract.  On occasion, a deed may be used like a mortgage but only evidence security and does not actually convey any interest in the real property.

   Example: A borrows money from B and B would like security for the loan. A signs a mortgage deed to B securing the loan, stating that the deed is for mortgage purposes. The mortgage deed is recorded and the transfer return claims Exemption (10). B's interest in the property is only as security for a loan. The mortgage deed does not give B any fee simple interest in the property.  Once the loan is paid off, B can also deed the property back to A claiming Exemption (10), since B is releasing security for a debt. Since there is no conveyance of a fee simple interest in such a situation where Exemption (10) is claimed, the Real Property Lister should not change the tax bill address  unless “Tax Bill Mailing Address” on the eRETR is filled in.

Sheriff Sales

1. Is an Electronic Real Estate Transfer Return needed on Sheriff Sales?

   Yes.  An electronic Real Estate Transfer Return is due for all Sheriff's Deeds, even if the deed may be exempt from transfer fee.

2. When is a transfer fee due on a Sheriff’s Deed?

   A transfer fee is due whenever a third party is the successful bidder. A third party is defined as someone who is not holding a lien or mortgage on the property or, if under a land contract, is not the seller (vendor). Usually lien holders are listed as plaintiffs or defendants in the foreclosure judgment.  If the original mortgage lender has assigned the mortgage to another entity, that entity is now the lienholder.

   When a transfer fee is due on a sheriff's sale, it is calculated on the amount of the successful bid and is to be paid out of the proceeds on the sale in the same manner as all other expenses are paid, per sec. 846.16, Wis. Stats. The statute further requires that the Sheriff shall file a completed transfer return, a transfer fee (if due), and the Sheriff’s Deed with the Clerk of Court, who shall then transmit all of the foregoing to the Register of Deeds.

   The Sheriff is acting as trustee/fiduciary for the debtor and is responsible to ensure that these expenses are properly satisfied. The Department will send any additional transfer fee assessments to the Sheriff to collect when exemption (14)  is claimed improperly.

3. When is a transfer fee not due on a Sheriff’s Deed?

   The exemption provided by sec. 77.25(14), Wis. Stats., applies when the conveyance is “Under a foreclosure or a deed in lieu of a foreclosure to a person holding a mortgage or to a seller under a land contract.”  Only the mortgage holder or the holder of the vendor's interest in a land contract may be the grantee under the Sheriff's Deed in order to qualify for the exemption.

4. If a mortgage has been assigned, does the assignment of the mortgage have to be recorded for sec. 77.25(14), Wis. Stats.,  to apply?
   • Generally, yes. The assignment does not need to be recorded to qualify for the exemption if the assignee is one of the following:
   • An insurer such as HUD, Fannie Mae, Freddie Mac, VA, etc.
   • Another lender who actually holds the mortgage, if plaintiff was acting as servicing agent.
   • A subsidiary of the lender due to regulations that prohibit lender from holding assets.

   Note: This is a new position the Department is taking to allow assignment to the lender's subsidiary whether the assignment occurs before or after the sale is confirmed by the court. In the past, if the assignment was after the sale, a transfer fee was due on a conveyance to a subsidiary under Tax.15.03, Wis. Adm. Code.

5. How is the transfer return completed for a Sheriff's Deed?
   
   The proper name for Grantor is the debtor's (title holder's) name and, likewise, his/her Social Security Number. If the debtor’s Social Security Number and address cannot be obtained after a reasonable search, all 9’s may be put on the return. The Sheriff is acting as trustee/fiduciary for the debtor and does not have title to the property. Therefore, the Sheriff is not the grantor and the exemption per sec. 77.25(2), Wis. Stats., cannot be used. The Sheriff’s name, address and telephone number must be placed in as grantor’s agent. The remaining parts of the return are to be completed in the same manner as with any other conveyance.

6. The successful bidder at a sheriff’s sale  is an LLC. The only members of the LLC are the defendants, a husband and wife. They purchased their own house, but in the name of the LLC. The LLC was in existence prior to the commencement of the foreclosure and the sheriff’s sale. Is this transfer exempt pursuant to § 77.25(15s) because the Grantors are the only members of the Grantee?

   No. The conveyance is not exempt per sec. 77.25(15s), Wis. Stats., since Exemption (15s) requires the conveyance be for no consideration. A purchase at a sheriff's sale does not meet that requirement. Nor does sec. 77.25(14), Wis. Stats., apply since the LLC would be considered a “third party.” However; it would be exempt under the “2 step” method if the individuals were to be the successful bidders and take title using Exemption (14) and then convey into their LLC using Exemption (15s).

7. Does a transfer return have to be filed when an IRS Certificate of Sale of Seized Property (Form 2435) is recorded?

   No. This document is used to place a lien on the property for 180 days as a redemption period for the person whose property was seized. If, after the 180 days nothing has been done to redeem the property, the IRS will give the buyer a District Quit Claim Deed and transfer return to record. This transaction is usually subject to transfer fee. The exemption for conveyance from a governmental agency under sec. 77.25(2), Wis. Stats., does not apply since the government did not have title and is only acting as a fiduciary in passing the title from the person the property was seized from to a third-party buyer. This is similar to a sheriff's sale where the transfer fee is due.

Short Sales

1. How is the transfer fee calculated on a “short sale," where the amount owed on a mortgage exceeds the purchase price?

   The transfer fee is calculated on what is paid (cash or equivalent) plus any liens, including any back taxes. Section 77.21(3)(a), Wis. Stats., states that “In the case of any conveyance not a gift, the amount of the full actual consideration paid therefor or to be paid, including the amount of any lien or liens thereon.”

   Example: $150,000 is remaining on the mortgage from an original sale of $165,000 ($15,000 down payment with no additional equity paid during the life of the loan) and the new "short sale" is for $135,000. The fee is on $135,000 as the sale price to the new owner. Any "short"  that the former owner owes to the bank is excluded in computing the transfer fee.

Social Security Numbers

1. What law permits the Department of Revenue to require Social Security Numbers (SSN/FEIN) to be reported on the transfer return?

   Congress enacted section 1211 of the Tax Reform Act of 1976, P.L. 94-455, Title 42 U.S.C. § 405(c)(2)(C), which  authorizes the use of an SSN/FEIN by a state, “in the administration of any tax, general public assistance, driver’s license, or motor vehicle registration law within its jurisdiction.”

2. When there is more than one grantor or grantee, do we have to list Social Security Numbers for each grantor and grantee? Yes. Include Social Security Numbers and address (if each is different) for each of the grantors and grantees.  The only exception is for a husband and wife with the same last name, if both first names are included in the same box, in which case only one Social Security Number is necessary.

3. If an individual buys property and does not have a Social Security Number, what do you report on the return?

   The Wisconsin Electronic Real Estate Transfer Return requires a taxpayer identification number to be furnished. When an individual does not have a Social Security Number or an Individual Taxpayer Identification Number (ITIN) and legally is not required to have one, simply fill the box in with all 9s.

   To determine whether or not an individual requires a SSN or ITIN, consult the U.S. Tax Guide for Aliens, Publication 519.

4. The grantor refuses to give his Social Security Number. How can we record the deed without this information?

   In instances where the grantor refuses to give his/her Social Security Number, complete the boxes with all 9s.

5. If a return is filed using all 9s for the grantor’s Social Security Number, does an amended return need to be filed later if the grantor’s Social Security Number is obtained?

   Yes. File an amended return and provide the Social Security Number. 

6. How is the Department of Revenue ensuring that the eRETR information, especially the Social Security Numbers and FEIN, are secure from identity theft?

   The eRETR is confidential per sec. 77.265, Wis. Stats. The Department of Revenue restricts access to the eRETR and the information on it. When the eRETR is used, the Social Security Numbers will only appear in the saved file on the preparer’s computer and on the printed summary section. If the summary is printed to take to closing for the parties, any copies to be handed out should have the Social Security Numbers redacted. Once the eRETR is submitted to the Department, the Social Security Number is moved to a different server from which only Revenue employees can access the data. Local government officials and other state agencies do not have access to the servers with the Social Security Numbers.

Timber, Minerals, Air Rights

1. What are the requirements for filing a real estate transfer return and payment of the transfer fee on mineral and timber rights?

    Whenever there is a conveyance of mineral or timber rights, an electronic real estate  transfer return is required since it is a conveyance of real estate per sec. 77.21(1m), Wis. Stats., and a transfer fee is required unless specifically exempt from fee under sec. 77.25, Wis. Stats. Any type of document, lease, assignment of lease, deed or any other instrument that conveys a mineral or timber interest is subject to a return and fee

Time Shares

1. Are timeshares subject to the Real Estate Transfer Fee?

   Yes. The definition of a conveyance  in sec. 77.21(1), Wis. Stats., specifically provides that "instruments that are evidence of a sale of time-share property, as defined in sec. 707.02(32)" are conveyances and they will require a transfer return and fee as a condition to recording the instrument, unless an exemption otherwise applies.

2. A timeshare week is being deeded to the owners' association in satisfaction of unpaid timeshare assessments.  The market value is $500 per week.  Are transfer fees due on this conveyance?

   Yes, a transfer fee is due on the fair market value of the timeshare.  The transfer fee is due from the grantor.

Transfer by Affidavit

1. I have to record a Transfer by Affidavit (PR-1831) with the Real Estate Transfer Return (PE-500) per s. 77.22(1), Stats. since the assets include real estate. What real estate value do I put on the transfer return?

   The real estate value on the transfer return and Transfer by Affidavit needs to be the fair market value per s. 77.21(3), Stats. The value MUST be the fair market value and not the equitable value without regard to liens, debts or other offsets.

2. Is a transfer return required when a Transfer by Affidavit (PR-1831) is recorded and includes real estate?
   Transfers by affidavit are subject to the same statutory requirements as are the Real Estate Transfer returns.
   For example: If you are:
   • An heir - exemption 11 applies
   • A guardian - may or may not be exempt depending on who you are the guardian of.
   • A Trustee - exemption 11 or 16 may apply.

Transfer Fee Miscellaneous

1. Why is another transfer fee due on an assignment of a vendee’s interest in a land contract, when the fee was paid on the original land contract?

   These transactions are two separate conveyances.   The vendee's interest in a land contract represents the equitable ownership of the property.   An assignment of the vendee's interest is equivalent to another deed of the ownership.  See Wis. Admin. Code § Tax 15.04(3).

2. What is the measure of the fee when a vendee sells his/her interest in an original land contract for $100,000 and there is a balance owing on the land contract in the amount of $100,000?

   $200,000.The fee is computed using the full actual consideration paid, including the amount of any lien or liens thereon per sec. 77.21(3), Wis. Stats.

3. An unmarried couple owns a house as joint tenants and now one wants to convey her interest to the other owner. Is a transfer fee due, and if so, how is the fee computed?

   A transfer fee is  due on one half the value of the property. The conveyance is not exempt as a partition under sec. 77.25(5), Wis. Stats., since there is a loss and a gain of ownership interest.

4. The current owner of the real property is a profit sharing plan, which purchased the property for $70,000. The profit sharing plan agrees to sell the property to the grantee for $70,000.  The grantee wants to build a house on the property. The grantee has applied for financing for the property and the improvements in the amount of $255,050. The bank disburses the funds until the grantee gets the property (land and home) in his/her name. The financing will pay the profit sharing plan $70,000 for the land. The remaining loan proceeds will go to a builder to pay for the improvements. Should the transfer tax be figured on $70,000 or $255,050?

   The value subject to fee is the value of real property at the time of conveyance. If the house has not yet been built, then the value of the real property is $70,000 and that figure should be used to compute the fee. If the house has been built at the time of conveyance, the value is $255,050 and the fee is computed on $255,050. See the R & R Development case that can be found  at the following link:  http://www.wisbar.org/witaxop/1999/97t212.htm

5. Are expenses such as back taxes and the broker's commission, which are paid by the buyer on behalf of the seller, included in the value subject to transfer fee?

   Yes. Whenever a buyer pays any expenses of the seller, including the real estate broker's commission, those payments are part of the total amount paid, which is subject to the transfer fee. Section 77.21(3)(a) Wis. Stats., defines value as the amount of the full actual consideration paid or to be paid including any liens thereon.

   Example: Seller lists property for sale for $100,000 with broker's commission of 7% upon sale. Buyer offers $93,000.00 and agrees to pay a $7,000.00 commission directly to broker. The transfer fee is on the full $100,000 since the buyer is paying the seller's broker expense in addition to the $93,000 for the property.

6. Would a buyer's broker commission be included in the "Value Subject to Fee"?

   No. When a buyer signs a buyer's broker agreement for the broker to locate a property on behalf of the buyer, the commission is not included in the value subject to fee. This commission does not become part of the purchase price since it is not consideration paid to or on behalf of the seller.

7. My boyfriend cosigned the mortgage and was put on the title with me when I purchased my home. He now wants to remove his name from the title by conveying his interest to me. Is this exempt from fee per sec. 77.25(3) or (10), Wis. Stats.?

   No. A transfer fee is due on the conveyance of one-half the value of the property, whether or not the boyfriend paid anything. Since both of you held title to the property, he is conveying his one-half the interest in real property and Exemption (3) does not apply. Exemption (3) provides for a non-conveyance of an interest in real property; the instrument recorded merely corrects the deed that conveyed the real estate. The use of Exemption (10) is to solely provide or release Security in a debt. This exemption also does not convey an interest in real property, but merely places or releases a lien on the Property. In addition, the exemption under sec. 77.25(5), Wis. Stats. for partition does not apply. Partition is a division among co-owners and not a conveyance that removes one person as owner, per sec. 77.21(1k), Wis. Stats.

8. A red stop sign appears stating that the filer must enter an exemption when I am completing an eRETR to report a deed that conveys half of a property to a tenant in common. If no exemption is applicable , what entry is required to remove the stop sign for completion of the eRETR?

   Most likely the filer is reporting the entire value of the real estate instead of one-half the value. The first box on the Fee Computation page asks for the “Real estate value transferred”, not the total value of the real estate. If only 50% is transferred, enter 50% of the fair market value and then the same value would be entered in the box “Value subject to transfer fee.

Transfer on Death Deed (TOD Deed)

1. Explain the filing requirements for the exemptions  pursuant to sec. 77.25(10m), Wis. Stats., “Solely to designate a TOD beneficiary under sec. 705.15,” and sec. 77.25(11m), Wis. Stats., “By non-probate transfer on death under sec. 705.15.”

   Sec. 77.25(10m), Wis. Stats.: Per sec. 705.15(2), Wis. Stats., a Transfer on Death (TOD) beneficiary is designated on a deed that must be recorded.  Per 705.15(3), Wis. Stats., the designation of a TOD beneficiary on a deed does not affect ownership of the property until the owner's death. A document that only designates a transfer on death beneficiary does not require a transfer return; however, language must be placed on the document to exempt it from return and fee such as: “This document is only designating a transfer on death beneficiary and is exempt per sec. 77.21(1), Stats and sec. 77.25(10m), Wis. Stats.”

   Sec. 77.25(11m), Wis. Stats.: A non-probate transfer of real property on death per sec. 705.15, Wis. Stats., is conveyed at the time of death of the sole owner or the last to die of multiple owners.  When recording a document evidencing the termination of the decedent’s interest in the property, a transfer return is required.

2. Is a transfer return with an exemption pursuant to sec. 77.25(11m), Wis. Stats., required to be filed when: 1) the final judgment is recorded; 2) the personal representative's deed is recorded; or 3) the new TOD-110 form which pertains to non-probate transfers of real property under sec. 705.15, Wis. Stats., to a Transfer On Death (TOD) beneficiary is filed?

   Yes, a transfer return is required to be filed in all three situations, but no fee is due. When the document being recorded indicates the property is being transferred to a beneficiary who was designated on a previous recording, a transfer return is required. The document number of the recorded document that established the TOD beneficiary must be entered on the fee-computation page of the electronic Real Estate Transfer Return (eRETR).  The document number must be entered on the eRETR in the next box after selecting Exemption (11m).

3. Section 705.15, Wis. Stats., allow for non-probate transfers of real property at death. A single person and/or a couple could provide for property to pass upon death to their beneficiaries without probate. Since there is no passage of ownership interest occurring when filing a document designating beneficiaries under this section, is a transfer return required?

   No return is needed. The provisions of sec. 705.15, Wis. Stats., allow a non-probate transfer of real property by executing a deed transferring the assets to a designated person upon the owner’s death. The designated person receiving the transfer on death acquires no interest or right until the grantor dies. Therefore, when a deed made pursuant to sec. 705.15, Wis. Stats., is recorded, a return is not needed and the document should indicate words to the effect that “this is a deed per sec. 705.15, Wis. Stats., and not a conveyance under sec. 77.21(1), Wis. Stats.” When filing a deed upon the death of the grantor, a return is required but there is no fee since the exemption under sec. 77.25(11m), Wis. Stats., will apply.

4. When filling out a transfer return upon the death of the grantor in a Transfer On Death to a beneficiary situation, would the Grantor be the decedent and would you use the decedent’s Social Security Number?

   The grantor is the decedent and you would use the decedent’s Social Security Number.

5. Non-Probate TOD Deed was recorded and now I want to revoke it.  A Quit Claim Deed has been drafted that states specifically the Deed is made pursuant to sec. 705.15(3), Wis. Stats., and is removing the beneficiary.  Will a Transfer Tax Return be needed and what exemption should be used?

   Per 705.15(3), Wis. Stats, the designation of a TOD beneficiary on a deed does not affect ownership of the property until the owner's death. A document designating or removing a transfer on death beneficiary does not require a transfer return; however, language must be placed on the document to exempt it from return such as: “This document is only removing a transfer on death beneficiary and is exempt per sec. 77.21(1), Stats and sec. 77.25(10m), Wis. Stats.”

Trustee Deed

1. A trust beneficiary receives a Trustee's Deed marked “Exemption (11)” with no transfer return. Does it qualify for the exemption under sec. 77.25(11), Wis. Stats., “By will, descent, or survivorship?”

   No. The exemption pursuant to sec. 77.25(11), Wis. Stats., is only used for conveyances from an estate (deceased individual) made by will, decent or survivorship.  The Trustee's Deed is exempt instead under sec. 77.25(9), Wis. Stats., "from a trustee to a beneficiary," as long as there was no consideration exchanged, and a return is required.

Trusts

1. Why is a transfer return needed when creating a trust?

   A trust is an entity created by a settlor (grantor) who entrusts some or all of his/her property to be managed by a person or persons of the grantor's choice (trustee/grantee), for the benefit of another (beneficiary).  Therefore, because a person actually transfers ownership of his/her assets to the trust it is a conveyance per sec. 77.21, Wis. Stats., and a transfer return is generally required.  A transfer fee may or may not be required depending upon the circumstances.

2. When you have a deed to or from a trust, when filling out the eRETR, do you enter the trust name or the trustee’s name as the Grantor/Grantee?

   In the Grantor/Grantee section, select “Trust” as the Grantor/Grantee type and enter the trust name as the Grantor/Grantee. The trustee's name is entered in the Agent section as agent. Sec. 701.05(1), Wis. Stats. requires that title to trust property be held in the name of the trustee. The Register of Deeds will accept the receipt as complying with the name matching rule. Note that when entering the Tax Identification Number (TIN) of the trust, it is important to know whether the trust is a revocable trust.  For a revocable trust only, a TIN is not used.  Instead, the Social Security Number of the original grantor of the trust is required.

3. Can the exemption under sec. 77.25(11), Wis. Stats., be used when conveying property from a trust to the beneficiaries?<\p>

   No.  The exemption per sec. 77.25(11), Wis. Stats., is only used for conveyances from an estate (deceased individual) by will, descent or survivorship. Since the property is in a trust, the exemption under sec. 77.25(9), Wis. Stats., can be used “from a trustee to beneficiary without actual consideration,” as long as there was no consideration exchanged.

4. An Individual creates a trust and conveys property to it. The beneficial rights to the trust are sold by the creator of the trust. (This type of trust is commonly used in Illinois.) When the rights are sold, nothing is recorded since this is similar to selling stock or an interest in a partnership and is considered the transfer of personal property. Now the trustee is to convey the real property to the beneficiaries. Is the conveyance exempt from fee pursuant to sec. 77.25(9), Wis. Stats.

   No. To be exempt, the conveyance must be "from a trustee to beneficiary without actual consideration." Since the beneficiaries purchased their interest, there was consideration exchanged and, therefore, the conveyance does not meet the requirement of the exemption under sec. 77.25(9), Wis. Stats.

5. When transferring the ownership of your homestead to a trust, how do you re-title your deed from your name to the name of your trust?

   A deed and an Electronic Wisconsin Real Estate Transfer Return (eRETR) must be completed to convey title to real estate.  You may want to consult with a title company or an attorney for additional information in regards to this type of transfer.

6. Is a transfer return required when a Trustee's Deed is recorded to evidence a change of trustees?  For instance, property occupied by a disabled person and his parent is held in a trust and the trustee (bank) is changed to an individual successor trustee (individual) for the same trust?

   Changing a trustee of a trust that holds the same property is not a conveyance and a transfer return is not needed.  The deed should state “this is only a change of trustees and not a conveyance per sec. 77.21(1), Wis. Stats.”

7. A daughter is quit claiming her interest in property back to her mother who wishes to put the  property into her trust.  Can this be done with one deed/transfer return or does it requires two deeds/transfer returns?

   The daughter can deed the property directly to the mother’s trust with one deed/transfer return and claim the exemption under sec. 77.25(16), Wis. Stats., provided the conveyance is 1) for no consideration, and 2) the mother is the beneficiary of the trust.  Section 77.25(16), Wis. Stats., applies since the conveyance to the mother (for no consideration) would be exempt under sec. 77.25(8), Wis. Stats.

8. Property is in a revocable living trust. The trustee (father) now wants to convey the real estate to a limited liability company (LLC) whose only members are his children. Is there a fee due if the real estate is transferred directly to the LLC?

   Yes, a fee is due since no exemption applies.  The trustee/father is not transferring the property directly to his children for no consideration under sec. 77.25(8), Wis. Stats., the trustee/father is not a member of the LLC under sec. 77.25(15s), Wis. Stats., and the LLC is not a beneficiary of the trust so sec. 77.25(9), Wis. Stats., does not apply.

9. Is conveying real property into a revocable living trust exempt from transfer fees, even if there is debt on the property?

   Yes, the exemption under sec. 77.25(16), Wis. Stats., would still apply provided that  the transfer from the grantor to the beneficiary would be exempt under some other exemption of sec. 77.25 Wis. Stats.

10. Is an assignment of vendee’s interest in a land contract to a trust, created for the benefit of the grantor’s children, exempt from transfer fees?

    No.  The balance of the land contract assumed constitutes consideration, therefore the exemptions under secs. 77.25(16) and (8) do not apply. 

11. After a grantor created a trust, he conveyed real property to it.  He then sold the beneficiaries' rights to the trust.  Is a transfer fee due?

    No, the sale of the beneficiaries' rights is considered the sale of personal property -similar to common stock sales-and is not recorded.  However, the transfer of the real property from the trust to the new “beneficiary” is subject to the transfer fee.  The exemption under sec. 77.25(9), Wis. Stats., does not apply because the new beneficiary purchased their interest in the trust and this constitutes consideration.

12. A will directs that real property be conveyed to the grandchildren of the deceased.  Since the children are minors, the estate transfers the property to a trust set up for the grandchildren.  Is a fee due?No.  The exemption pursuant to sec. 77.25(11), Wis. Stats., applies, “By will, descent or survivorship”.  There is no return or fee due.

Value of Property (Subject to Transfer Fee)

1. When gifting property to your children and grandchildren while keeping a life estate, is there a formula to calculate the value of the remainder being conveyed

   Yes, the value required on the transfer return is the fair market value of the remainder being transferred. This is calculated on the fair market value of the entire property multiplied by a factor ("Expected Return Multiple") as determined on the Actuarial Tables in IRS Publication 939, General Rule for Pensions and Annuities. This publication may be found on the IRS web site: http://www.irs.gov/pub/irs-pdf/p939.pdfThe value gifted to the children would be exempt from the transfer fee per sec. 77.25(8), Wis. Stats. However, the value gifted to the grandchildren would be subject to the transfer fee. On the eRETR “Fee computation” page, enter the total value of the entire property in “Total value of real estate transferred.” In the "Value Subject to Fee" box, enter the value calculated using the Actuarial Tables referred to above,  of the remainder interest to be conveyed to the grandchildren. The preparer should select Exemption (8) - “Gift Parent/Children” for the balance of the total real estate value in the exemption selection box.

2. Is there another table we can use that has a formula to calculate the value of property being conveyed that is the remainder of a life estate?

   Yes, you may use the table in the Wisconsin Department of Health and Family Services Medicaid Eligibility Handbook found at: http://www.emhandbooks.wi.gov/meh-ebd. The value that is required on the return is the fair market value of the remainder being transferred. This is calculated on the fair market value of the entire property multiplied by the factor as determined in the table.

3. The Real Estate Transfer Return Instructions indicate that the “real estate value transferred” can be zero “0” for exemptions (3), (10), (13) and (17). Why no value and zero used?

   Zero (0) may be entered as the real estate value transferred for the following exemptions:

   • Sec. 77.25(3), Wis. Stats.: “Which, executed for nominal, inadequate or no consideration, confirms, corrects or reforms a conveyance previously recorded.” Under exemption (3), the real property was previously conveyed on the deed now being corrected. The correction deed does not convey any fee simple interest thus the value is zero.
   • Sec. 77.25(10), Wis. Stats.: "Solely in order to provide or release security for a debt or obligation."  Such a document does not convey any real estate, but simply places or removes a lien or cloud on the title.
   • Sec. 77.25(13), Wis. Stats.: “Of real estate having a value of $100 or less.” Because the tax is imposed on each $100 of value, if the real estate's fair market value  is less than $100, it is deemed to have no value and zero may be entered. You cannot use special use valuations for purposes of this exemption.
   • Sec. 77.25(17), Wis. Stats.: “Of a deed executed in fulfillment of a land contract if the proper fee was paid when the land contract or an instrument evidencing the land contract was recorded.” In Wisconsin, ownership of real estate is transferred when a land contract is entered into.  If the transfer tax was paid at that time, then the deed in fulfillment of the land contract is essentially a satisfaction of the financing and is not a conveyance.
4. What is the value subject to fee on a conveyance of a vacant lot with a contract to construct a building?

   The value subject to transfer fee is only the value of the real property at the time of conveyance. The improvement value would be included with the lot value only on that percentage of improvements completed at the time of conveyance. Examples:

   • If there is only a vacant lot with a construction contract, include value of the lot only.
   • Improvements are 50% completed – include value of lot plus 50% of the value of the improvements.
   • Improvements are100% completed – include value of lot plus total value of the improvements.

   See R & R Development Group, LLC v. Wisconsin Department of Revenue, Wisconsin Tax Appeals Commission, Docket No. 97-T-212, Decision and Order dated February 11, 1999.

Weatherization

If claiming an exclusion from the Rental Weatherization standards, refer to the list of exclusion codes within the eRETR instructions:
https://ww2.revenue.wi.gov/GenericFile/help/eRetr/detail.htm#weatherization. Further information in regards to the Weatherization Program and Exclusion Codes can be found at the Department of Safety and Professional Services website:
http://dsps.wi.gov/sb/SB-RentalWeatherizationProgram.html#resources  

1. Is a conveyance that is exempt from transfer fee under sec. 77.25, Wis. Stats., also exempt from the Rental Weatherization standards under sec. 101.122, Wis. Stats.?

   Yes. Exclusion code W-3 applies if the conveyance was exempt under one of the exemptions from transfer fee under sec. 77.25, Wis. Stats.  See Wis. Admin. Code SPS sec. 367.03(1)(b)1.

2. If I buy a residential building to fix it up and sell, do I need to comply with the Rental Weatherization standards? The property will not be rented to anyone or occupied as a primary residence during the time of rehabilitation.

   Yes, since the future use of the building is not ensured, these types of transfers are subject to the Rental Weatherization standards.  However, you may file a Stipulation to delay compliance for up to a year.  If the property is sold within that year, the buyer may take over responsibility for compliance.  If the buyer will owner-occupy within that year, they can obtain a Satisfaction of Compliance from the Department of Safety & Professional Services.   

3. Are property purchases by relocation companies subject to the Rental Weatherization standards?

   Yes. However, similar to the rehabilitation scenario above, a Stipulation may be filed, compliance may be taken over by a subsequent buyer and then satisfied by owner-occupancy within a year of the first transfer.

4. Do the Rental Weatherization standards apply to a property that will be torn down within two years of transfer?

   Yes.  In this case, you would file a Waiver that indicates that the property will be demolished within two years of the transfer. Once the property is demolished, notify the Department of Safety & Professional Services and a Satisfaction of Compliance will be issued. The Satisfaction of Compliance  should be recorded with the Register of Deeds.

5. Are transfers due to foreclosures subject to the Rental Weatherization standards?

   If sec. 77.25(14), Wis. Stats. as a transfers to a person holding the mortgage or to the seller under land contract applies to the conveyance they are also excluded from the Rental Weatherization standards under exclusion code W-3. (Note: If sec. 77.25(14), Wis. Stats. does NOT apply to the conveyance then they are subject to the Weatherization Standards. Any previously recorded Stipulations or Waivers related to that property will be nullified.  However, any subsequent transfer to a party without a previous interest in the property could be subject to the standards.

6. Are transfers by probate subject to the Rental Weatherization standards?

   No, transfers as a part of the probate process, including transfers to third parties, are excluded from the Rental Weatherization standards under exclusion code W-11. Any previously recorded Stipulations or Waivers related to that property will be nullified.  However, any subsequent transfer to a party outside of probate could be subject to the standards.

7. Are the Rental Weatherization standards applicable to a dwelling that I plan on allowing a family member to live in without paying rent?

   Yes.  The exemption for owner-occupied property is limited to the purchaser and does not extend to other family members if the purchaser does not use it as his/her primary residence. (If the occupant will have life tenancy, then it would be a W-11 excluded transfer.)

8. When is the W-4 exclusion, for dwellings not rented in the winter, applicable?

   It is applicable to seasonal rental units, such as cottages, that are not intended to be rented during the heating season, i.e. November 1 through March 31.  It is not applicable to dwellings that may be vacant for some period of time after purchase, due to rehabilitation, flipping or relocation purposes.

Will, Descent or Survivorship

1. If four siblings receive real estate and other assets in equal shares pursuant to a will, does sec. 77.25(11), Wis. Stat., “By will, descent or survivorship”, apply where an agreement between the heirs states one heir will receive the real estate and the remaining heirs receive other assets?

   Yes,  in such case, the conveyance is by will, descent or survivorship and Exemption (11) applies. However, if the heir receiving the real estate has to pay the estate or siblings any consideration, that amount would be subject to transfer fee. This may happen when the real estate value is greater than the other assets and the payment to the estate (“boot”) creates equal shares. In this case, when completing the fee computation page on the return, the total real estate value conveyed is the fair market value of the property.  The total value subject to fee would be the amount paid to the estate and the preparer should select Exemption (11) for the balance of the total real estate value. Note: Normally Exemption (11) does not require a transfer return but when “boot” is paid in to the estate a transfer return is required to be submitted to the Register of Deeds.

2. A trust beneficiary receives a Trustee's Deed marked Exemption (11) with no transfer return. Does it qualify for Exemption (11), by will descent or survivorship?

   No. The exemption pursuant to sec. 77.25(11), Wis. Stats., is only used for conveyances from an estate (deceased individual) made by will, decent or survivorship.  The Trustee's Deed is exempt instead under sec. 77.25(9), Wis. Stats., "from a trustee to a beneficiary," as long as there was no consideration exchanged, and a return is required.

   For more information contact:

   WISCONSIN DEPARTMENT OF REVENUE
   Division of State & Local Finance
   Equalization Bureau 6-97
   P.O. Box 8971
   Madison, WI 53708-8971
   Phone: (608) 264-6885 or (608) 266-1594
   Fax: (608) 264-6897
   E-Mail Additional Questions

Last updated March 6, 2013