Some home buyers liked to keep secret how much money they paid for their homes.
This fog over correctness of public records on property sold prices was lifted with California AB 1888: New California Law on Real estate transaction transparency.
This was signed into law by Governor Brown in June 2014 and eliminates the option for parties to avoid disclosing in public records the amount of documentary transfer tax payable at closing of real estate transactions.
Purpose of this law is to make the value of each transaction readily apparent, which some buyers and sellers had wanted to avoid.
Counties and cities in CA are authorized to levy documentary transfer tax upon the recordation of documents transferring interests in real property.
CA Revenue and Taxation Code Section 11932 previously said that a document submitted for recordation must show the amount of documentary transfer tax due either on its face, or in a separate statement that is not recorded.
With the tax shown on the face of the recorded document, determining the purchase price in a transaction should be easy since the county/city tax used to determine the documentary transfer tax is known.
Parties wanting this kept secret were previously allowed the ability to submit a separate, nonrecorded statement, and that has stopped.
AB 1888 amended Section 11932 of the Taxation Code – purpose of this law was to provide for transparency in the administration of California’s documentary transfer tax law, to resolve issue relating to availability of transfer tax information under the California Public Records Act (CPRA), and to ensure that real estate appraisers have access to transfer tax information in order to accurately appraise real property.
This new law is effective as of January 1, 2015, and should make pricing of homes information easier to determine.
By Harrison K. Long, professional real estate representative, Realtor, real estate broker, and professional real estate representative at Orange County CA. Source of some information is article by Stroock & Stroock & Lavan LLP, Los Angeles law firm.
We provide professional real estate agent and broker representation – help for property owners, home sellers, private trust estate representatives, estate administrators, executors and heirs, probate and trust attorneys, estate planners, income tax professionals, public guardians, fiduciaries, investor group managers, bankers, and individuals, with listing and sale of properties at Orange County, CA. Contact us at 949-854-7747 with your questions about home prices and values at Orange County CA cities and areas with Home Selling and Real Estate market updates.
This post about California law is for information only and is not the providing of legal services. If you have questions about legal issues with your real estate transaction, you should contact an experienced real estate attorney.