093_SB1883sam002

 










                                     LRB093 08674 SJM 14372 a

 1                    AMENDMENT TO SENATE BILL 1883

 2        AMENDMENT NO.     .  Amend Senate Bill 1883, AS  AMENDED,
 3    by  replacing  everything  after the enacting clause with the
 4    following:

 5        "Section 5.  The Property Tax Code is amended by changing
 6    Sections 31-5, 31-10, 31-20, and 31-25 and by adding  Section
 7    3-46 as follows:

 8        (35 ILCS 200/31-5)
 9        Sec.  31-5.   Definitions.   "Recordation"  includes  the
10    issuance  of  certificates  of  title  by Registrars of Title
11    under the Registered Titles (Torrens)  Act  pursuant  to  the
12    filing  of deeds or trust documents for that purpose, as well
13    as the recording of deeds or trust documents by recorders.
14        "Department" means the Department of Revenue.
15        "Person" means any natural individual, firm, partnership,
16    association, joint stock company, joint adventure, public  or
17    private   corporation,   limited   liability  company,  or  a
18    receiver, executor, trustee, guardian or other representative
19    appointed by order of any court.
20        "Value" means the amount of the full actual consideration
21    for the real property, including the amount of  any  lien  on
22    the real property assumed by the buyer.
 
                            -2-      LRB093 08674 SJM 14372 a
 1        "Trust document" means a document required to be recorded
 2    under the Land Trust Recordation and Transfer Tax Act.
 3        "Beneficial interest" includes, but is not limited to:
 4             (1)  the  beneficial  interest  in  an Illinois land
 5        trust;
 6             (2)  the  lessee  interest   in   a   ground   lease
 7        (including  any  interest  of  the  lessee in the related
 8        improvements) that provides for a  term  of  30  or  more
 9        years  when  all options to renew or extend are included,
10        whether or not any portion of the term has expired; or
11             (3)  the  indirect  interest  in  real  property  as
12        reflected by a controlling  interest  in  a  real  estate
13        entity.
14        "Controlling  interest"  means  50%  or  more of the fair
15    market  value  of  all  ownership  interests  or   beneficial
16    interests in a real estate entity.
17        "Real  estate entity" means any person including, but not
18    limited to, any partnership, corporation,  limited  liability
19    company,  trust,  other  entity, or multi-tiered entity, that
20    exists or acts  substantially  for  the  purpose  of  holding
21    directly  or  indirectly  title  to or beneficial interest in
22    real property. There is  a  rebuttable  presumption  that  an
23    entity  is  a  real  estate  entity  if  it owns, directly or
24    indirectly, real property having a fair market value  greater
25    than  75%  of  the  total  fair  market  value  of all of the
26    entity's  assets,  determined  without  deduction   for   any
27    mortgage, lien, or encumbrance.
28    (Source: P.A. 92-651, eff. 7-11-02.)

29        (35 ILCS 200/31-10)
30        Sec.  31-10.   Imposition of tax. A tax is imposed on the
31    privilege  of  transferring  title   to   real   estate,   as
32    represented by the deed that is filed for recordation, and on
33    the  privilege  of transferring a beneficial interest in real
 
                            -3-      LRB093 08674 SJM 14372 a
 1    property that is the subject of a land trust  as  represented
 2    by  the  trust document that is filed for recordation, and on
 3    the privilege of transferring a  controlling  interest  in  a
 4    real estate entity, at the rate of 50¢ for each $500 of value
 5    or  fraction  of  $500  stated in the declaration required by
 6    Section 31-25.  If,  however,  the  deed  or  trust  document
 7    states   that   the  real  estate,  beneficial  interest,  or
 8    controlling interest is transferred subject  to  a  mortgage,
 9    the  amount of the mortgage remaining outstanding at the time
10    of transfer shall not be included in the basis  of  computing
11    the  tax.  The  tax  is due if the transfer is made by one or
12    more related transactions or involves one or more persons  or
13    entities and whether or not a document is recorded.
14    (Source:  P.A.  86-624;  86-925;  86-1028;  86-1475;  87-543;
15    88-455.)

16        (35 ILCS 200/31-20)
17        Sec. 31-20.  Affixing of stamps. Payment of the tax shall
18    be evidenced by revenue stamps in the amount required to show
19    full  payment  of the tax imposed by Section 31-10. Except as
20    provided in Section 31-45, a deed,  document  transferring  a
21    controlling  interest  in  real  property,  or trust document
22    shall not be accepted for filing by any recorder or registrar
23    of titles unless revenue stamps in the required  amount  have
24    been  purchased  from  the recorder or registrar of titles of
25    the  county  where  the   deed,   document   transferring   a
26    controlling  interest  in real property, or trust document is
27    being filed for recordation.  The  revenue  stamps  shall  be
28    affixed  to  the  deed,  document  transferring a controlling
29    interest in real property, or trust document by the  recorder
30    or  the  registrar of titles either before or after recording
31    as requested by the grantee. A person  using  or  affixing  a
32    revenue  stamp  shall cancel it and so deface it as to render
33    it unfit for reuse by marking it with his or her initials and
 
                            -4-      LRB093 08674 SJM 14372 a
 1    the day, month and  year  when  the  affixing   occurs.   The
 2    marking shall be made by writing or stamping in indelible ink
 3    or  by  perforating  with  a  machine  or punch. However, the
 4    revenue stamp shall not be so defaced  as  to  prevent  ready
 5    determination of its denomination and genuineness.
 6    (Source:  P.A.  86-624;  86-925;  86-1028;  86-1475;  87-543;
 7    88-455.)

 8        (35 ILCS 200/31-25)
 9        Sec.  31-25.  Transfer declaration. At the time a deed, a
10    document  transferring  a  controlling   interest   in   real
11    property,  or trust document is presented for recordation, or
12    within 3  business  days  after  the  transfer  is  effected,
13    whichever  is  earlier,  there shall also be presented to the
14    recorder or registrar of titles a  declaration, signed by  at
15    least  one  of the sellers and also signed by at least one of
16    the buyers in the transaction or by the attorneys  or  agents
17    for  the  sellers  or  buyers.   The  declaration shall state
18    information including, but  not  limited  to:  (a)  the  full
19    consideration  for  the property or interest in real property
20    so transferred; (b) the  parcel  identifying  number  of  the
21    property;  (c) the legal description of the property; (d) the
22    date of the deed, the date the transfer was effected, or  the
23    date  of  the trust document; (e) the type of deed, transfer,
24    or trust document; (f) the address of the property;  (g)  the
25    type of improvement, if any, on the property; (h) information
26    as  to whether the transfer is between related individuals or
27    corporate affiliates or is a compulsory transaction; (i)  the
28    lot  size or acreage; (j) the value of personal property sold
29    with the real estate; (k) the year the contract was initiated
30    if an installment  sale;  and  (l)  the  name,  address,  and
31    telephone  number  of  the  person preparing the declaration.
32    Except as provided in  Section  31-45,  a  deed,  a  document
33    transferring  a  controlling  interest  in  real property, or
 
                            -5-      LRB093 08674 SJM 14372 a
 1    trust document shall not be accepted for  recordation  unless
 2    it  is  accompanied  by  a  declaration  containing  all  the
 3    information   requested   in   the   declaration.   When  the
 4    declaration is  signed by an attorney or agent on  behalf  of
 5    sellers  or  buyers  who  have the power of direction to deal
 6    with the  title  to  the  real  estate  under  a  land  trust
 7    agreement,  the  trustee  being the mere repository of record
 8    legal title with a duty of conveying  the  real  estate  only
 9    when  and  if  directed  in  writing  by  the  beneficiary or
10    beneficiaries having the power of direction, the attorneys or
11    agents executing the declaration on behalf of the sellers  or
12    buyers  need  identify  only  the  land  trust  that  is  the
13    repository  of  record legal title and not the beneficiary or
14    beneficiaries having the power of direction  under  the  land
15    trust  agreement. The declaration form shall be prescribed by
16    the Department and shall contain sales information questions.
17    For sales occurring during a period in which  the  provisions
18    of Section 17-10 require the Department to adjust sale prices
19    for  seller  paid  points  and  prevailing cost of cash,  the
20    declaration  form  shall  contain  questions  regarding   the
21    financing   of  the  sale.   The  subject  of  the  financing
22    questions shall include any direct  seller  participation  in
23    the financing of the sale or information on financing that is
24    unconventional  so  as to affect the fair cash value received
25    by the  seller.   The  intent  of  the  sales  and  financing
26    questions  is to aid in the reduction in the number of buyers
27    required to provide financing information necessary  for  the
28    adjustment  outlined  in  Section 17-10.  For sales occurring
29    during a period in which  the  provisions  of  Section  17-10
30    require  the Department to adjust sale prices for seller paid
31    points and prevailing cost  of  cash,  the  declaration  form
32    shall  include, at a minimum, the following data:  (a) seller
33    paid points, (b) the  sales  price,  (c)  type  of  financing
34    (conventional,  VA, FHA, seller-financed, or other), (d) down
 
                            -6-      LRB093 08674 SJM 14372 a
 1    payment,  (e)  term,  (f)  interest  rate,   (g)   type   and
 2    description   of   interest   rate   (fixed,   adjustable  or
 3    renegotiable), and (h) an appropriate place for the inclusion
 4    of special facts or circumstances,  if  any.  The  Department
 5    shall  provide  an  adequate supply of forms to each recorder
 6    and registrar of titles in the State.
 7    (Source: P.A. 91-555, eff. 1-1-00.)

 8        (35 ILCS 200/31-46 new)
 9        Sec.  31-46.  Exemption  from  tax  equal  to   corporate
10    franchise taxes paid. If a transfer of a controlling interest
11    in  a  real estate entity is taxed under this Article and the
12    real estate entity liable for the tax under this  Article  is
13    also  liable for corporate franchise taxes under the Business
14    Corporation Act of 1983 as a result of the transfer, then the
15    real estate entity is exempt  from  paying  the  tax  imposed
16    under  this  Article to the extent of the corporate franchise
17    tax paid by the  real  estate  entity  as  a  result  of  the
18    transfer.  The  exemption  shall  not  reduce the real estate
19    entity's tax liability under this Article to less than zero.

20        Section 10.  The Stock, Commodity, or Options Transaction
21    Tax Exemption Act is amended by adding Section 3 as follows:

22        (35 ILCS 820/3 new)
23        Sec. 3.  Construction of Act. Nothing in this  Act  shall
24    be  construed  as  prohibiting  or otherwise invalidating any
25    real estate transfer tax or fee authorized  or  permitted  by
26    Section  31-10  of the Property Tax Code, Section 5-1031.1 of
27    the  Counties  Code,  or  Section  8-3-19  of  the   Illinois
28    Municipal  Code.  This Section is intended as a clarification
29    and not as a change to existing law.

30        Section 15.  The Counties Code  is  amended  by  changing
 
                            -7-      LRB093 08674 SJM 14372 a
 1    Section 5-1031.1 as follows:

 2        (55 ILCS 5/5-1031.1)
 3        Sec. 5-1031.1. Home rule real estate transfer taxes.
 4        (a)  After  the  effective date of this amendatory Act of
 5    the 93rd General Assembly 1996 and subject to this Section, a
 6    home rule county may impose or increase a tax or other fee on
 7    the privilege  of  transferring  title  to  real  estate,  as
 8    represented by the deed that is filed for recordation, and on
 9    the privilege of transferring a beneficial interest in a land
10    trust  holding  legal  title  to  real  property,  and on the
11    privilege of transferring a controlling interest  in  a  real
12    estate   entity,   as   the   terms   "beneficial  interest",
13    "controlling interest", and "real estate entity" are  defined
14    in  Article 31 of the Property Tax Code as represented by the
15    trust document that is filed for recordation.  Such a tax  or
16    other  fee  on  the  privilege  of transferring title to real
17    estate,  as  represented  by  the  deed  that  is  filed  for
18    recordation,  and  on  the  privilege   of   transferring   a
19    beneficial  interest  in  a land trust holding legal title to
20    real property, as represented by the trust document  that  is
21    filed  for  recordation,  shall hereafter be referred to as a
22    real estate transfer tax.
23        (b)  Before adopting a resolution to submit the  question
24    of  imposing  or  increasing  a  real  estate transfer tax to
25    referendum,  the  corporate  authorities  shall  give  public
26    notice of and hold a public hearing on the intent  to  submit
27    the  question  to  referendum.  This hearing may be part of a
28    regularly scheduled meeting  of  the  corporate  authorities.
29    The  notice shall be published not more than 30 nor less than
30    10 days prior to  the  hearing  in  a  newspaper  of  general
31    circulation within the county.  The notice shall be published
32    in the following form:
33             Notice  of Proposed (Increased) Real Estate Transfer
 
                            -8-      LRB093 08674 SJM 14372 a
 1        Tax for (commonly known name of county).
 2             A public  hearing  on  a  resolution  to  submit  to
 3        referendum  the  question  of a proposed (increased) real
 4        estate transfer tax for (legal name of the county) in  an
 5        amount  of (rate) to be paid by the buyer (seller) of the
 6        real estate transferred will be held on (date) at  (time)
 7        at  (location).  The current rate of real estate transfer
 8        tax imposed by (name of county) is (rate).
 9             Any person desiring to appear at the public  hearing
10        and present testimony to the taxing district may do so.
11        (c)  A notice that includes any information not specified
12    and  required  by  this  Section  is  an invalid notice.  All
13    hearings shall be open to the public.  At the public hearing,
14    the corporate authorities of the  county  shall  explain  the
15    reasons  for  the  proposed or increased real estate transfer
16    tax  and  shall  permit  persons  desiring  to  be  heard  an
17    opportunity  to  present  testimony  within  reasonable  time
18    limits determined by the corporate authorities.   A  copy  of
19    the proposed ordinance shall be made available to the general
20    public for inspection before the public hearing.
21        (d)  No  home  rule county shall impose a new real estate
22    transfer tax after the effective date of this amendatory  Act
23    of  1996  without prior approval by referendum.  No home rule
24    county shall impose an increase of the rate of a current real
25    estate transfer tax without prior approval by referendum.   A
26    home rule county may impose a new real estate transfer tax or
27    may  increase an existing real estate transfer tax with prior
28    referendum approval.  The referendum shall  be  conducted  as
29    provided   in   subsection  (e).  An  existing  ordinance  or
30    resolution imposing a real estate transfer tax may be amended
31    without approval by referendum  if  the  amendment  does  not
32    increase the rate of the tax.
33        (e)  The  home  rule county shall, by resolution, provide
34    for submission of the proposition to the  voters.   The  home
 
                            -9-      LRB093 08674 SJM 14372 a
 1    rule  county shall certify the resolution and the proposition
 2    to the proper  election  officials  in  accordance  with  the
 3    general  election law.  If the proposition is to impose a new
 4    real estate transfer tax, it shall be  in  substantially  the
 5    following form:  "Shall (name of county) impose a real estate
 6    transfer  tax  at  a  rate  of (rate) to be paid by the buyer
 7    (seller) of the real estate transferred, with the revenue  of
 8    the proposed transfer tax to be used for (purpose)?".  If the
 9    proposition  is  to increase an existing real estate transfer
10    tax, it shall be in the  following  form:   "Shall  (name  of
11    county)  impose  a  real  estate  transfer  tax  increase  of
12    (percent  increase)  to  establish a new real estate transfer
13    tax rate of (rate) to be paid by the buyer  (seller)  of  the
14    real estate transferred?  The current rate of the real estate
15    transfer   tax  is  (rate),  and  the  revenue  is  used  for
16    (purpose).  The revenue from the increase is to be  used  for
17    (purpose).".
18        If  a  majority of the electors voting on the proposition
19    vote in favor of it, the county may impose  or  increase  the
20    real estate transfer tax.
21        (f)  Nothing  in  this amendatory Act of 1996 shall limit
22    the purposes for which real estate transfer tax revenues  may
23    be collected or expended.
24        (g)  A  home  rule  county  may  not  impose  real estate
25    transfer taxes other than as authorized by this Section. This
26    Section is a denial and limitation of home  rule  powers  and
27    functions under subsection (g) of Section 6 of Article VII of
28    the Illinois Constitution.
29        (h)  Notwithstanding  subsection (g) of this Section, any
30    real estate transfer taxes that were imposed by a  county  at
31    any  time  prior to the effective date of this amendatory Act
32    of  the  93rd  General  Assembly  are   hereby   specifically
33    authorized,  permitted,  and  validated under this subsection
34    (h).
 
                            -10-     LRB093 08674 SJM 14372 a
 1    (Source: P.A. 89-701, eff. 1-17-97; 90-14, eff. 7-1-97.)

 2        Section 20.  The Illinois Municipal Code  is  amended  by
 3    changing Section 8-3-19 as follows:

 4        (65 ILCS 5/8-3-19)
 5        Sec. 8-3-19.  Home rule real estate transfer taxes.
 6        (a)  After  the  effective date of this amendatory Act of
 7    the 93rd General Assembly 1996 and subject to this Section, a
 8    home rule municipality may impose or increase a tax or  other
 9    fee on the privilege of transferring title to real estate, as
10    represented by the deed that is filed for recordation, and on
11    the privilege of transferring a beneficial interest in a land
12    trust  holding  legal  title  to  real  property,  and on the
13    privilege of transferring a controlling interest  in  a  real
14    estate   entity,   as   the   terms   "beneficial  interest",
15    "controlling interest", and "real estate entity" are  defined
16    in  Article 31 of the Property Tax Code as represented by the
17    trust document that is filed for recordation.  Such a tax  or
18    other  fee  on  the  privilege  of transferring title to real
19    estate,  as  represented  by  the  deed  that  is  filed  for
20    recordation,  and  on  the  privilege   of   transferring   a
21    beneficial  interest  in  a land trust holding legal title to
22    real property, as represented by the trust document  that  is
23    filed  for  recordation,  shall hereafter be referred to as a
24    real estate transfer tax.
25        (b)  Before adopting a resolution to submit the  question
26    of  imposing  or  increasing  a  real  estate transfer tax to
27    referendum,  the  corporate  authorities  shall  give  public
28    notice of and hold a public hearing on the intent  to  submit
29    the  question  to  referendum.  This hearing may be part of a
30    regularly scheduled meeting  of  the  corporate  authorities.
31    The  notice shall be published not more than 30 nor less than
32    10 days prior to  the  hearing  in  a  newspaper  of  general
 
                            -11-     LRB093 08674 SJM 14372 a
 1    circulation  within  the  municipality.   The notice shall be
 2    published in the following form:
 3             Notice of Proposed (Increased) Real Estate  Transfer
 4        Tax for (commonly known name of municipality).
 5             A  public  hearing  on  a  resolution  to  submit to
 6        referendum the question of a  proposed  (increased)  real
 7        estate  transfer tax for (legal name of the municipality)
 8        in an amount of (rate) to be paid by the  buyer  (seller)
 9        of  the real estate transferred will be held on (date) at
10        (time) at (location). The current  rate  of  real  estate
11        transfer tax imposed by (name of municipality) is (rate).
12             Any  person desiring to appear at the public hearing
13        and present testimony to the taxing district may do so.
14        (c)  A notice that includes any information not specified
15    and required by  this  Section  is  an  invalid  notice.  All
16    hearings  shall be open to the public. At the public hearing,
17    the corporate authorities of the municipality  shall  explain
18    the  reasons  for  the  proposed  or  increased  real  estate
19    transfer tax and shall permit persons desiring to be heard an
20    opportunity  to  present  testimony  within  reasonable  time
21    limits determined by the corporate authorities. A copy of the
22    proposed  ordinance  shall  be  made available to the general
23    public for inspection before the public hearing.
24        (d)  No home rule municipality shall impose  a  new  real
25    estate   transfer  tax  after  the  effective  date  of  this
26    amendatory Act of 1996 without prior approval by  referendum.
27    No  home  rule  municipality  shall impose an increase of the
28    rate of a current real  estate  transfer  tax  without  prior
29    approval  by referendum.  A home rule municipality may impose
30    a new real estate transfer tax or may  increase  an  existing
31    real estate transfer tax with prior referendum approval.  The
32    referendum  shall be conducted as provided in subsection (e).
33    An existing ordinance or resolution imposing  a  real  estate
34    transfer tax may be amended without approval by referendum if
 
                            -12-     LRB093 08674 SJM 14372 a
 1    the amendment does not increase the rate of the tax.
 2        (e)  The  home  rule  municipality  shall, by resolution,
 3    provide for submission of the proposition to the voters.  The
 4    home rule municipality shall certify the resolution  and  the
 5    proposition  to  the  proper election officials in accordance
 6    with the general election law.   If  the  proposition  is  to
 7    impose  a  new  real  estate  transfer  tax,  it  shall be in
 8    substantially  the   following   form:    "Shall   (name   of
 9    municipality)  impose a real estate transfer tax at a rate of
10    (rate) to be paid by the buyer (seller) of  the  real  estate
11    transferred, with the revenue of the proposed transfer tax to
12    be  used  for (purpose)?".  If the proposition is to increase
13    an existing real estate transfer tax,  it  shall  be  in  the
14    following  form:  "Shall (name of municipality) impose a real
15    estate  transfer  tax  increase  of  (percent  increase)   to
16    establish a new transfer tax rate of (rate) to be paid by the
17    buyer  (seller)  of the real estate transferred?  The current
18    rate of the real estate  transfer  tax  is  (rate),  and  the
19    revenue is used for (purpose).  The revenue from the increase
20    is to be used for (purpose).".
21        If  a  majority of the electors voting on the proposition
22    vote in favor of it, the municipality may impose or  increase
23    the municipal real estate transfer tax or fee.
24        (f)  Nothing  in  this amendatory Act of 1996 shall limit
25    the purposes for which real estate transfer tax revenues  may
26    be collected or expended.
27        (g)  A  home rule municipality may not impose real estate
28    transfer taxes other than as authorized by this Section. This
29    Section is a denial and limitation of home  rule  powers  and
30    functions under subsection (g) of Section 6 of Article VII of
31    the Illinois Constitution.
32        (h)  Notwithstanding  subsection (g) of this Section, any
33    real  estate  transfer  taxes  that   were   imposed   by   a
34    municipality  at any time prior to the effective date of this
 
                            -13-     LRB093 08674 SJM 14372 a
 1    amendatory Act  of  the  93rd  General  Assembly  are  hereby
 2    specifically  authorized, permitted, and validated under this
 3    subsection (h).
 4    (Source: P.A. 89-701, eff. 1-17-97.)

 5        Section 99.  Effective date.  This Act takes effect  upon
 6    becoming law.".