§ 11-3-202. EXEMPTIONS.

(a)

General exemptions. The transfer tax does not apply to:

(1)

Transfers by way of mortgages securing a debt;

(2)

Transfers between husband and wife;

(3)

Transfers between divorced individuals in accordance with an agreement filed in the divorce case;

(4)

Transfers by or to the United States, the state, or, except as provided in § 11-3-205 of this subtitle, the county or their political subdivisions; and

(5)

If no part of their net income inures to private shareholders or individuals, transfers to hospitals, religious, charitable, scientific, literary, educational, fraternal, or benevolent institutions, civic improvement associations, service clubs, volunteer fire companies, banks and building or savings and loan associations, or youth organizations.

(b)

Federal government mortgages. The transfer tax does not apply to a transfer to a mortgagee which is presented to the Director simultaneously with a deed from the mortgagee to the federal government or any instrumentality, agency, or political subdivision of the federal government.

(c)

Transfer between relatives. If there is no consideration paid or to be paid in connection with a transfer, the transfer tax does not apply to transfers between:

(1)

Parent and daughter, son, stepdaughter, or stepson;

(2)

Parent and daughter-in-law, son-in-law, step daughter-in-law, or step son-in-law;

(3)

Grandparent and grandchild or step grandchild; or

(4)

Siblings, half-siblings, or step siblings, in any combination.

(d)

Partitioning of undivided interests between joint owners. If there is no consideration paid or to be paid in connection with the transfer, the transfer tax does not apply to transfers made for the partitioning in kind between joint owners of undivided interests.

(e)

Straw party. The transfer tax does not apply to a transfer made to a straw party for the grantor or to a transfer of the same estate by the straw party to:

(1)

The straw party's original transferor; and

(2)

The original transferor's spouse and child and the spouse of the original transferor's child.

(f)

Straw party, holding company. The transfer tax does not apply to a transfer made by a straw party or holding company to the person for whose sole benefit the straw party or holding company is holding title if the straw party or an officer of the holding company provides an affidavit to the Director establishing that the straw party or holding company held title:

(1)

For the sole benefit of the person named as grantee in the conveyance from the straw party or holding company; and

(2)

From the date of its acquisition by the straw party or holding company.

(g)

Will, descent, life estates. The transfer tax does not apply to a transfer:

(1)

By will or descent; or

(2)

In which the grantor reserves a life estate coupled with full power to grant, convey, mortgage, lease or otherwise dispose of the entire estate, including the estate in remainder during the grantor's lifetime, without the consent of the remainderman.

(h)

Connected with a previous transfer. If any consideration paid or to be paid in connection with the transfer is $100 or less, the transfer tax does not apply to a transfer made expressly for the purpose of confirming, correcting, modifying, or supplementing a previous transfer.

(i)

Property less than $100. The transfer tax does not apply if the value of the property transferred is less than $100.

(j)

Parent and subsidiary corporations.

(1)

This subsection applies to transfers involving parent and subsidiary corporations only if the parent corporation:

(i)

Previously owned the real property;

(ii)

Has owned the stock of the subsidiary for more than 18 months; or

(iii)

Acquires the stock of a subsidiary corporation which, for at least 2 years has:

1.

Been in existence; and

2.

Owned the real property.

(2)

(i)

The transfer tax does not apply to:

1.

Transfers between a subsidiary corporation and its parent corporation; or

2.

Transfer of title to real property between two or more subsidiary corporations wholly owned by the same parent corporation.

(ii)

The exemption under this paragraph applies only to transfers for no consideration, for nominal consideration, or in sole consideration of the issue or the cancellation or surrender of a subsidiary's stock.

(3)

The transfer tax does not apply to transfers made expressly for the purpose of confirming and carrying out articles of consolidation or merger accepted for record by the State Department of Assessments and Taxation.

(k)

Residential property.

(1)

If the instrument of writing is accompanied by a statement under oath signed by the grantee that the residence will be occupied by the grantee, the transfer tax does not apply to the first $22,000 of the consideration payable for an instrument of writing for owner-occupied residential real property.

(2)

The exemption provided under paragraph (1) of this subsection shall be applied against the grantee's transfer tax payment required under this title, unless the grantor has agreed by contract to pay the entire county transfer tax, in which case the exemption shall be applied against the grantor's transfer tax..

(1988 Code, §§ 33-127, 33-139) (Bill No. 87, 1990, § 2, 8-13-1990; Bill No. 68, 1992, § 1, 7-1-1992; Bill No. 128, 1992, § 2, 7-13-1992; Bill No. 66-95, § 2, 6-30-1995; Bill No. 102-95, § 1, 7-1-1995; Bill No. 49-96, § 20, 7-1-1996; Bill No. 153-97, § 1, 3-8-1998; Bill No. 8-01, § 1, 4-14-2001; Bill No. 33-03, § 2, 7-1-2004)