Martin O'Malley, Governor

Ch. 3

(II) UNDER THE TERMS OF THE OFFERING, NONE OF THE
NEW MEMBERS IS EXPECTED TO PARTICIPATE IN THE DAY-TO-DAY
MANAGEMENT OF THE REAL PROPERTY ENTITY.

(G) (1) THE DEPARTMENT SHALL ADOPT REGULATIONS TO
ADMINISTER THIS SECTION.

(2) THE REGULATIONS SHALL INCLUDE ANY ADDITIONAL
STANDARDS AND EXEMPTIONS TO ASSURE THAT:

(I)        A TAX IS IMPOSED WHEN A TRANSACTION IS
STRUCTURED INVOLVING A CONTROLLING INTEREST IN A REAL PROPERTY
ENTITY TO AVOID PAYMENT OF THE RECORDATION TAX;

(II)      EXEMPTIONS PROVIDED BY LAW WHEN REAL PROPERTY
IS TRANSFERRED BY AN INSTRUMENT OF WRITING ARE APPLICABLE; AND

(III)     THERE IS NO DOUBLE TAXATION OF A SINGLE
TRANSACTION.

13-103.

(A) IN THIS SECTION, "CONTROLLING INTEREST", "REAL PROPERTY",
AND "REAL PROPERTY ENTITY" HAVE THE MEANINGS STATED IN § 12-117 OF
THIS ARTICLE.

(b) (1) The taxes under this title are imposed on the

TRANSFER OF A CONTROLLING INTEREST IN A REAL PROPERTY ENTITY AS IF
THE REAL PROPERTY, DIRECTLY OR BENEFICIALLY OWNED BY THE REAL
PROPERTY ENTITY, WAS CONVEYED BY AN INSTRUMENT OF WRITING THAT IS
RECORDED WITH THE CLERK OF THE CIRCUIT COURT FOR A COUNTY OR FILED
WITH THE DEPARTMENT UNDER § 13-202 OF THIS TITLE.

(2)       THE TAXES UNDER THIS SECTION ARE IMPOSED ON THE
CONSIDERATION PAYABLE FOR THE TRANSFER OF THE CONTROLLING INTEREST
IN THE REAL PROPERTY ENTITY OR ON THE VALUE OF THE REAL PROPERTY
DIRECTLY OR BENEFICIALLY OWNED BY THE REAL PROPERTY ENTITY, AS
PROVIDED IN § 12-117(B)(2) OF THIS ARTICLE.

(3)     (i) Except for the county transfer tax, the taxes

UNDER THIS SECTION SHALL BE APPLIED AT THE RATES ESTABLISHED IN THIS
TITLE.

- 111 -