Documentary transfer taxes collected on the transfer of real property interests are a major source of revenue for counties and municipalities in California. As local governments endeavor to refill their coffers, depleted in the wake of the recession, many have taken a closer look at the tax potential of a broad spectrum of real property conveyances beyond the classic transfer of a deed.
Assignments of long-term leases (often called “ground leases”), in particular, have fallen under the assessor’s microscope. County recorder’s offices across the state are paying close attention to lease assignments and may reject those which do not properly state the tax to be collected thereon.
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