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BILL AS INTRODUCED 2007-2008

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S.235

Introduced by Senator MacDonald of Orange District

Referred to Committee on

Date:

Subject:  Taxation; property transfer tax; 12 percent tax; abatement of tax; primary residence

Statement of purpose:  This bill proposes to increase the property transfer tax rate on primary residences to 12 percent, but to provide an abatement and refund of one-sixth of the tax for each year it is occupied as a primary residence.  Unabated tax is refunded at the time of later sale, if the seller then purchases another Vermont primary residence.  New revenue is appropriated to the Vermont Housing Finance Agency to assist first-time home buyers.

AN ACT RELATING TO PROPERTY TRANSFER TAX ON PRIMARY RESIDENCES

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  32 V.S.A. § 9602 is amended to read:

§ 9602.  TAX ON TRANSFER OF TITLE TO PROPERTY

A tax is hereby imposed upon the transfer by deed of title to property located in this state.  The amount of the tax equals one and one quarter

one-quarter percent of the value of the property transferred, or $1.00, whichever is greater, except as follows:

(1)  with respect to the transfer of property to be used for the principal residence of the transferee or his or her lessee, the tax shall be imposed at the rate of five-tenths of one percent of the first $100,000.00 in value of the property transferred and at the rate of one and one quarter percent of the value of the property transferred in excess of $100,000.00 12 percent of the value of the property transferred.  One-sixth of the property transfer tax paid under this subdivision shall be abated and refunded by the department of taxes to the owner of the property at the end of each calendar year in which the property was occupied during the entire year as the homestead by a lessee, or by an owner who has timely declared the homestead under section 5410 of this title.  Any property transfer tax not abated and refunded at the time of sale of the property by that owner shall be abated and refunded if, within six months of the sale, that owner purchases another Vermont property to be used as the principal residence of the transferee or his or her lessee.

* * *

(4)  Eighty-five percent of the revenue from the tax imposed under subdivision (1) of this section shall be appropriated and transferred to the Vermont Housing Finance Agency for the purposes of assisting first‑time home buyers with interest rate buy-down, down-payment grants, or other means of assistance in purchasing a first home.

Sec. 2.  EFFECTIVE DATE

     This act shall apply to property transfers on or after July 1, 2008.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us