5318

VETOES

FOR the purpose of imposing recordation and transfer taxes
on certain dissolutions and liquidations; and providing
for the determination of "consideration" in certain
transactions.

BY adding to

Article 81 - Revenue and Taxes

Section 277B

Annotated Code of Maryland

(1980 Replacement Volume and 1981 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That section(s) of the Annotated Code of Maryland
read(s) as follows:

Article 81 - Revenue and Taxes

277B.

(A)  THE TAXES IMPOSED ON INSTRUMENTS OF CONVEYANCE OF
PROPERTY OR TRANSFER OF TITLE TO PROPERTY BY SECTIONS 277
AND 278A OF THIS ARTICLE, AND BY THE TRANSFER TAXES OF THE
COUNTIES AND THE CITY OF BALTIMORE, ARE APPLICABLE TO THE
TRANSACTIONS DESCRIBED IN SUBSECTIONS (B) AND (C) OF THIS
SECTION, EXCEPT AS PROVIDED IN SUBSECTION (E).

(B)  THE TAXES REFERRED TO IN SUBSECTION (A) APPLY TO
WRITTEN INSTRUMENTS CONVEYING THE REAL PROPERTY OF A
CORPORATION TO ITS SHAREHOLDERS ON THE LIQUIDATION,
DISSOLUTION, OR TERMINATION OF THAT CORPORATION.

(C)  THE TAXES REFERRED TO IN SUBSECTION (A) APPLY TO
WRITTEN INSTRUMENTS CONVEYING THE REAL PROPERTY OF A
PARTNERSHIP TO ITS PARTNERS ON THE LIQUIDATION, DISSOLUTION,
TERMINATION, OR WINDING UP OF THE AFFAIRS OF THAT
PARTNERSHIP.

(D)   IN DETERMINING THE AMOUNT OF CONSIDERATION ON
WHICH THE TAXES ARE TO BE BASED, THE ASSESSED VALUATION FULL
CASH VALUE OF THE PROPERTY INVOLVED SHALL BE USED IN

CALCULATING THE FULL CASH VALUE OF THE PROPERTY AS

DETERMINED BY THE DEPARTMENT AT THE LAST DATE OF FINALITY
SHALL BE USED.

(E)  A TRANSACTION DESCRIBED IN SUBSECTIONS (B) AND (C)
MAY NOT BE TAXED TO THE EXTENT THAT:

(1)  PROPERTY IS CONVEYED TO A PERSON WHO WAS AN
ORIGINAL SHAREHOLDER OR PARTNER OF THE ENTITY INVOLVED;

(2)  PROPERTY IS CONVEYED TO A DIRECT DESCENDANT
OR RELATIVE WITHIN 2 DEGREES OF A PERSON WHO WAS AN ORIGINAL
SHAREHOLDER OR PARTNER OF THE ENTITY INVOLVED; OR